Kraken CEO Hits Back at Bank Lobby Over Stablecoin Yields
Ripley Rebukes Bankers’ Pushback
David Ripley, chief executive of U.S. crypto platform Kraken, has pushed back against the American Bankers Association (ABA) later than a senior executive claimed that paying yields on stablecoins would undermine the role of traditional banks. The platform of words highlights growing friction between the crypto sector and banking institutions as stablecoins move closer to mainstream finance.
Speaking at the ABA’s annual convention, the association’s senior vice president of innovation and strategy, Brooke Ybarra, argued that allowing major platforms such as Kraken or Coinbase to pay interest on payment stablecoins would “fly in the face” of their intended use as payment tools rather than stores of value. She said such practices would harm banks’ ability to “support their communities.”
Ripley dismissed that view. “A detriment to who?” he said. “Consumers should have the freedom to choose where they hold value and the most efficient way to send that value.”
Investor Takeaway
Kraken’s Argument: “We’re Building Something Else”
Ripley accused banks of profiting from customer deposits without passing on the benefits. “We are building toward something else — a system where services once reserved for the wealthy are accessible to everyone,” he said. His remarks come as stablecoin yields on some platforms reach up to 5%, compared with a U.S. average savings rate of 0.6% and top high-yield offers near 4%, according to Bankrate.
Other figures in the crypto sector backed Ripley’s criticism. Dan Spuller, head of industry affairs at the Blockchain Association, said, “large banks are ruthlessly targeting our friends at @Coinbase and @KrakenFX to protect their turf.” He later added, “Translation: competition’s winning.”
Developers and users echoed the sentiment on social media. Solana developer Voss wrote, “Bring on the competition, it’s a capitalist world anyway.”
Stablecoins and the GENIUS Act
The debate comes just months later than U.S. President Donald Trump signed the GENIUS Act, a long-awaited regulatory framework that provides legal clarity for stablecoins. The act allows qualified issuers to hold reserves in short-term U.S. Treasuries and to offer limited yield-bearing products, subject to federal oversight. The law has sparked optimism in the crypto industry that stablecoins could soon play a larger role in payments and digital finance.
Analysts say the potential for yield-bearing stablecoins challenges banks’ traditional deposit base. Some stablecoin issuers and platforms are already testing tokenized cash instruments that function like digital money market funds — a model that could divert deposits from commercial banks toward regulated crypto platforms.
Investor Takeaway
TradFi vs. Crypto: A Global Tension
The dispute reflects a broader global pattern. In June, Diogo Mónica, general partner at Haun Ventures, said many stablecoins are backed by reserves held in globally systemic banks or U.S. Treasury bills — assets he described as “securer than commercial bank deposits.”
Outside the U.S., crypto platforms continue to report banking restrictions. A Binance Australia survey found that local users still face barriers when trying to move funds between banks and platforms. Matt Poblocki, general manager for Binance in Australia and New Zealand, said that access to financial rails “directly affects participation, confidence and trust in the market,” noting that such constraints limit adoption and sluggish growth.
