As yield-bearing stablecoins evolve from a cryptocurrency settlement tool into deposit-like instruments that generate returns, U.S. banks and regulators are closely monitoring them. U.S. Bank CEO Brian Moynihan cited research warning that widespread adoption of stablecoins could lead to significant deposit outflows from banks, shrinking their lending base and increasing financing costs. Regulators are focused on the structure and regulation of stablecoins, including reserve composition and disclosure, because their yield features make these stablecoins similar to money market products. This scrutiny could steer liquidity in decentralized finance (DeFi) toward compliant, transparent stablecoin designs, benefiting platforms that meet regulatory standards while putting pressure on those employing aggressive yield strategies or opaque reserves.