Study Reveals $78M Net Outflow from Banks to Coinbase
A transaction-level study by data analytics firm KlariVis uncovered a net deposit outflow of $78.3 million from community banks to the cryptocurrency exchange Coinbase over a 13-month period. The analysis, which reviewed 225,577 transactions across 92 banks, found that total outflows reached $122.4 million, while only $44.2 million flowed back. This translates to a ratio where $2.77 departed for Coinbase for every $1.00 that returned, providing quantitative evidence of a capital shift from the traditional banking sector to digital asset platforms.
Money Market Accounts See 96% of Withdrawal Volume
The deposit drain was most pronounced in money market accounts, which are typically used by customers for higher-yield savings. These accounts represented 96.3% of the identifiable transaction volume leaving banks for Coinbase, contributing $36.8 million to the net outflow. The study also highlighted that smaller institutions are disproportionately affected. At banks with less than $1 billion in deposits, up to 84% of Coinbase-related transactions were outflows, a stark contrast to the 67% rate seen at banks larger than $1 billion. KlariVis estimates this $78.3 million outflow could diminish the lending capacity of these local banks by approximately $30.5 million.
Findings Fuel Debate Over $6T Stablecoin Shift
These findings intensify an ongoing legislative battle in the U.S. Congress over the CLARITY Act, which seeks to regulate digital assets. A central conflict is whether crypto intermediaries like Coinbase should be allowed to offer yield on stablecoin holdings—a practice banking groups warn could trigger a massive exodus of deposits. Bank of America CEO Brian Moynihan recently cited research suggesting up to $6 trillion could leave the U.S. banking system if interest-bearing stablecoins become widespread. In response, Coinbase CEO Brian Armstrong has opposed any legislation that would "eliminate stablecoin yield and protect banks from competition." Prediction markets currently indicate an 83% probability that a version of the CLARITY Act will be signed into law this year.
