Tether (CRYPTO: USDT) has launched USA₮, a federally regulated stablecoin issued by Anchorage Digital Bank, but Standard Chartered warns stablecoins could drain $100 billion from U.S. bank deposits with the market reaching $301.4 billion.

USA₮: Built For The GENIUS Act

Tether launched USA₮ on Monday to comply with the GENIUS Act, the first nationwide framework governing stablecoins sold to U.S. users.

The law requires stablecoins offered to Americans to be issued by federally or state-qualified entities. That locked out USDT, Tether’s flagship token, forcing the company to create a separate U.S.-compliant version.

Bo Hines, former White House Crypto Council Executive Director, leads the project as CEO of Tether USA₮.

USA₮ is now available on Bybit, Crypto.com, Kraken, OKX, and MoonPay. Cantor Fitzgerald serves as reserve custodian, ensuring transparency from day one.

This move puts Tether back in direct competition with Circle’s (NYSE:CRCL) USDC, which has dominated the U.S. institutional market due to early regulatory compliance. 

Meanwhile, USDT continues operating globally with $143 billion in circulation.

Paolo Ardoino, Tether’s CEO, called USA₮ “a dollar-backed token made in America” designed for institutions that need federal oversight.

Standard Chartered: Stablecoins Are A “Real Threat”

The same day Tether launched USA₮, Standard Chartered published a report warning that stablecoins pose a serious threat to bank deposits.

Geoff Kendrick, the bank’s global head of digital assets research, estimates U.S. bank deposits will shrink by one-third of the total stablecoin market cap—currently $301.4 billion. 

That translates to roughly $100 billion leaving U.S. banks as stablecoins grow.

The problem is simple: when customers move money from banks into stablecoins, that money doesn’t come back as stablecoin issuers don’t redeposit the cash into the banking system.

Tether holds just 0.02% of reserves in bank deposits. Circle holds 14.5%. The rest sits in Treasury bills and other instruments outside the traditional banking system.

That means every dollar flowing into stablecoins is a dollar permanently leaving bank balance sheets—reducing deposits that banks use to make loans and generate revenue.

Regional Banks Face The Biggest Hit

Kendrick’s analysis shows regional banks are most exposed because they rely heavily on deposits for profitability. 

He specifically flagged Huntington Bancshares, M&T Bank, Truist Financial, and CFG Bank as facing the highest risk.

Larger investment banks are less exposed because they generate revenue from multiple sources beyond deposit-driven lending.

Looking ahead, Kendrick projects the stablecoin market will reach $2 trillion by end-2028. 

At that scale, about $500 billion could leave developed-market banks, with another $1 trillion exiting emerging-market banks.

Circle (NASDAQ:CRCL) CEO Jeremy Allaire has called fears of stablecoin-driven bank runs “totally absurd,” but Standard Chartered’s numbers suggest the threat is real for banks that depend on deposits.

What Happens Next

Tether’s USA₮ launch legitimizes stablecoins in the U.S. regulatory framework, potentially accelerating adoption among institutions previously blocked from using USDT.

For banks, the expansion of federally regulated stablecoins like USA₮ and USDC increases competitive pressure. 

As stablecoins scale toward $2 trillion, regional banks face structural threats to deposit bases.

Standard Chartered expects the CLARITY Act to pass by the end of Q1 2026, which could limit stablecoin yields. But even without yields, stablecoins offer instant settlement and 24/7 availability—features traditional bank deposits can’t match.

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