GENIUS Act Predicted to Transform Retail Banking Landscape

According to PANews, Tushar Jain, managing partner at Multicoin Capital, forecasts that the introduction of the GENIUS Act will spark competitive changes in the retail banking sector, effectively ending the practice of traditional banks offering minimal interest to depositors. Jain suggests that major tech companies like Meta, Google, and Apple will leverage their extensive distribution networks to launch stablecoin products with higher yields, incorporating features such as instant settlement, round-the-clock payments, and free transfers, thereby directly challenging the retail deposit market dominated by traditional banks. Despite the banking industry's active lobbying efforts to prevent stablecoin platforms from offering competitive yields, Jain highlights that regulations prohibiting interest payments to stablecoin holders can be easily circumvented. He asserts that depositors deserve returns closer to market rates. Currently, the average interest rate on savings deposits in the United States stands at only 0.40%, with trillions of dollars in deposits earning zero interest, underscoring the need for new competition in the sector.