CoinDesk
The CEO of stablecoin infrastructure company Eco, Ryne Saxe, is pushing back against the banking lobby's argument that stablecoins will drain deposits from community banks, warning Congress not to let that case slow the Digital Asset Market Clarity Act, which advanced out of the Senate Banking Committee on a 15-9 bipartisan vote.
Saxe, who grew up in a rural Illinois town of about 5,000 where his father has worked at a community bank for more than 30 years, frames the debate as protectionism dressed up as small-bank advocacy. Community banks hold roughly one-tenth of US banking assets but originate more than a third of small business loans and nearly two-thirds of agricultural loans nationwide, a concentration he argues should push the conversation past deposits entirely.
Why it matters
The banking lobby's core claim is that every dollar moving onchain is a dollar leaving the banking system. Saxe counters that stablecoin activity still runs on banks, regulated issuers, custodians, payment companies, and fiat access points, so the real question is which institutions adapt fast enough to plug into the new rails. Total stablecoin supply has crossed $300B, and Tether (USDT) briefly overtook Ethereum by market cap to become the second-largest digital asset behind Bitcoin, putting the sector well past the point where it can be treated as fringe.
Market impact
Saxe points to the fintech decade as the precedent regulators should follow. PayPal and Stripe popularized digital banking without gutting community lenders, and SoFi, the largest publicly traded fintech bank, held $37.5B in deposits in Q4 2025, under 0.2% of the US banking system's roughly $20T base. The use cases driving current stablecoin growth, cross-border settlement, treasury operations, programmable transactions, 24/7 liquidity, do not overlap with the relationship-based lending community banks actually monetize, which is why he argues the deposit-drain framing collapses once the data is applied. If the Clarity Act is written to shield incumbents from competition rather than to set guardrails, Saxe writes, it will protect a fear rather than a market.
Frequently asked questions
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What is the Digital Asset Market Clarity Act?
It is a US market-structure bill for digital assets that advanced out of the Senate Banking Committee on a 15-9 bipartisan vote. Eco CEO Ryne Saxe argues its drafters should resist the banking lobby's push to slow stablecoin growth on deposit-drain grounds.
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How big is the US stablecoin market today?
Total stablecoin supply has exceeded $300 billion. Tether (USDT) briefly overtook Ethereum by market cap to become the second-largest digital asset behind Bitcoin, according to data cited in the column.
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Do community banks really face a deposit drain from stablecoins?
Eco's CEO argues no. Community banks hold roughly one-tenth of US banking assets but originate more than a third of small business loans and nearly two-thirds of agricultural loans, monetizing relationships and credit rather than deposit volume.
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How does the fintech precedent apply to stablecoins?
Saxe points to PayPal, Stripe, and SoFi as evidence that embedded finance grew up inside bank partnerships rather than displacing them. SoFi held $37.5B in Q4 2025 deposits, under 0.2% of the roughly $20T US deposit base.
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What does the column say Congress should actually do?
Write the Clarity Act to set guardrails and clear rules of the road for issuers and markets, not to pre-select which institutions get shielded from competition. The goal is consumer and market protection, not incumbent protection.
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