Banks Will Lobby For Stablecoin Yields Eventually: Coinbase CEO

Coinbase CEO Brian Armstrong has predicted that banks will start lobbying for yields on stablecoins in a few years.

“My prediction is the banks will actually flip and be lobbying FOR the ability to pay interest and yield on stablecoins in a few years, once they realize how big the opportunity is for them,” Armstrong wrote in a Dec. 27 X post.

Coinbase Won’t Let Banks Reopen Discussions Around The GENIUS Act

Amrstrong’s post was a response to a post by Digital Ascension Group chief business development officer Max Avery, who said that the banking lobby wants to reopen discussions around the GENIUS Act. 

In particular, banks continue to express concerns that current wording around stablecoin yields poses a risk to bank deposits, Avery said.

The GENIUS Act, which is the first regulatory framework for stablecoins and which was signed into law by US President Donald Trump in July,  prohibits stablecoin issuers from offering yields directly to token holders. However, it does not extend this ban to third-party service providers, meaning that stablecoin issuers could offer yields via these platforms.

Coinbase, for instance, offers traders and investors on its platforms yields on USDC, which is issued by the stablecoin firm Circle. 

Concerns over that ability to potentially offer yields through third-party platforms have been voiced by the banking lobby multiple times this year, noted Avery.  

Regardless of the banking lobby’s ongoing concerns, Armstrong said in his reply that he and Coinbase “won’t let anyone reopen GENIUS,” adding that it’s a “red line” for them. 

Following his prediction that banks will eventually start to lobby for stablecoin yields, he said that the current pushback against the GENIUS Act is “100% wasted effort on their part.” 

Stablecoin Market Expected To Soar To $500B By The End Of 2026

The regulatory clarity offered by the GENIUS Act served as a catalyst for the stablecoin market’s growth this year.

In 2025, the combined capitalization for stablecoins has soared to above $300 billion for the first time and currently stands at over $308.36 billion, data from DefiLlama shows. 

Stablecoin market cap (Source: DefiLlama)

Tether’s USDT token maintains a dominant share of the market with its capitalization of about $186.7 billion. USDC comes in at second with a market cap of approximately $76.38 billion, while Ethena’s USDe is ranked as the third-biggest stablecoin with a capitalization of $6.29 billion.

Following what has been a strong year for stablecoins, industry experts believe the growth for these tokens is expected to continue in 2026.

Among those experts is SharpLink co-CEO Joseph Chalom, who said that the stablecoin market cap will reach $500 billion by the end of 2026. 

“Global stablecoin use cases, including cross-border remittances, retail payments, and institutional transactions, will continue to increase with Ethereum establishing itself as the foundational settlement layer for the movement of value,” he said on X.

1/ The stablecoin market will hit $500B by the end of next year.

Global stablecoin use cases, including cross-border remittances, retail payments, and institutional transactions, will continue to increase with Ethereum establishing itself as the foundational settlement layer for…

— Joseph Chalom (@joechalom) December 26, 2025

He also said that big players will enter the stablecoin market next year, highlighting recent moves by JP Morgan, PayPal, Japan, South Korea, and EU banks. 

Chalom added that the adoption of stablecoins lays the groundwork for broader crypto adoption at institutions. 

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