Before the Civil War the U.S. did not have its own paper currency, much less a central bank to control the money supply. Banks issued paper bank notes which might or might not be exchanged at face value with merchants and other banks.
Nowadays, banks are looking at issuing their own stablecoin crypto currency which might or might not hold the value of $1 as intended. Cryptocurrency bank accounts would not pay interest or be FDIC-insured like USD bank accounts.
How Cryptocurrency Could Be Coming for Your Bank Account
We explain the benefits and the risks.
By Rob Copeland, The New York Times, Aug. 14, 2025
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Now the biggest banks in the country ā Chase, Bank of America and Citi, among them ā are planning to launch their own stablecoins. Retailers like Amazon and Walmart are also studying coins of their own.
This is all newly permissible under the GENIUS Act, a bipartisan law passed this summer with encouragement from the banks. The law is significant for a couple of reasons:
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Eliminating cash: It created a way for banks to offer customers stablecoins instead of handing back their money in cash. The stablecoins have to be exchangeable for U.S. dollars.
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Keeping the interest: Unlike the interest accrued in your checking and savings accounts, the law tells banks to keep the interest earned on stablecoinsā¦.
Banksā stablecoins could be available as early as next year.
The benefits? For you, this could potentially mean low fees and fast speeds for tricky transactions like overseas transfers.
The drawbacks? Beyond losing interest on accounts, you would also forgo the federal insurance that pays back depositors in the event of a bank failure. Thatās because the regulators treat stablecoin accounts as āinvestments,ā not ordinary deposits. In short, your accounts would have fewer protections than they do nowā¦ [end quote]
This has the potential to be hugeā¦or maybe not.
Itās clear how the banks benefit. But itās not clear at all how the ordinary customer, who doesnāt need cryptocurrency for international transfers would benefit. Even the supposed benefit of hiding transactions from the authorities wouldnāt be a benefit since banks would surely report transfers under money laundering laws.
Thereās the potential for large government bailouts if one of the TBTF banks miscalculates and causes a run on the bank. Just like the run on Silicon Valley bank or the repeated runs in the 1930s before FDIC.
Wendy