BIS economists find a 1bp deposit rate rise drops stablecoin growth to 12%

A 1-basis-point increase in US bank deposit rates trims the average 10-week stablecoin growth from about 15% to about 12%, according to a working paper from the Bank for International Settlements. A second method intended to isolate cause and effect puts the hit at about three times higher, leaving growth at about 6%. The baseline estimate entails a decline of about 3 percentage points in the 10-week pace for each basis point of deposit repricing. Growth slowed and stayed positive. USDC sheds 4.8 percentage points to USDT’s 1.9 Working Paper 1382 was authored by Iñaki Aldasoro, an economist at BIS, and Rashad Ahmed of the Andersen Institute for Finance and Economics and was published on October 13.

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