JPMorgan warns of $6.6 trillion risk from interest‑bearing stablecoins

Ben Nadareski, CEO and co‑founder of Solstice, explains that institutional treasuries are moving beyond the question of whether to enter crypto. He says stablecoins, tokenised assets and on‑chain yield products now compete with traditional bank accounts, Treasury bills and cash‑sweep tools, but most existing solutions were built for crypto‑native users and do not fit CFO workflows. The operational bottlenecks – from accounting integration to custody policies – limit scalability, and institutions need infrastructure that can handle large‑scale cash management.

At the same time, JPMorgan Chase’s chief financial officer Jeremy Barnum warned that interest‑bearing stablecoins could form a “parallel banking system” without the prudential safeguards that protect traditional deposits. The U.S. Treasury estimates up to US$6.6 trillion of deposits could be at risk if the regulatory gap is not closed. The issue is now being debated in Congress, with calls to extend banking‑level protections to stablecoins. JPMorgan, while developing its own tokenised money‑market fund, stresses that innovation must be matched by clear regulation to avoid systemic risk.