Higher U.S. bank deposit rates were associated with slower stablecoin market-capitalization growth, according to BIS Working Paper 1382, published October 13 and based on weekly data from January 2019 through June 2025. The study quantifies for the first time how closely dollar-denominated stablecoins compete with ordinary savings accounts. Stablecoin capitalization grew about 15% over a typical 10-week period; under the baseline framing, a one-basis-point increase in deposit rates reduced that growth to roughly 12%, while a second method produced growth of about 6%. A detailed version of the study reported a baseline reduction of roughly 2.8 percentage points and a 9.1-point reduction under its instrumental-variable model, creating a discrepancy in the estimates presented. The relationship was stronger for Circle’s USDC than Tether’s USDT, which the authors linked to USDC’s closer ties to U.S. users. The findings suggest banks retain some influence over stablecoin adoption through deposit pricing, but do not establish that stablecoins reduced total bank deposits or lending. The authors said regulators should consider whether issuers can pay yield and whether they should hold part of their reserves in bank deposits. The paper reflects the authors’ views, not necessarily those of the BIS, and covers a single high-rate cycle during which stablecoins paid holders no interest.