Bank of America Warns $6T Could Shift to Stablecoins, BitMine Invests in MrBeast, and X Bans InfoFi Apps

Bank of America CEO Brian Moynihan warned that up to $6 trillion in U.S. bank deposits could migrate to stablecoins if interest-bearing models are not restricted. The projection is based on U.S. Treasury Department studies and highlights concerns about potential impacts on bank lending and funding costs.

The CEO argued that stablecoins resemble money market funds, which typically invest in short-term instruments like U.S. Treasurys. This structure removes funds from the traditional banking system, reducing the deposit base used to support loans.

Legislative efforts are underway to address the risks. The Senate Banking Committee has proposed a bill that would ban passive interest on stablecoins while allowing activity-based rewards like staking or liquidity provision.

BitMine Immersion Technologies has agreed to invest $200 million in Beast Industries, the holding company of YouTube creator MrBeast. The investment is expected to close on or around Jan. 19.

The deal ties one of crypto's largest Ethereum treasury firms with a major content creator platform. Beast Industries plans to explore decentralized finance (DeFi) integrations within future financial services.

X has revoked API access for apps that reward users for posting, a move that has impacted Kaito's token price. The platform cited a surge in AI-generated spam and low-quality replies as reasons for the policy change.

Kaito's token dropped by nearly 20% following the announcement. The move was seen as a crackdown on incentivized posting, with mixed reactions from the crypto community.

The Senate Banking Committee postponed its markup of the crypto market structure bill after Coinbase CEO Brian Armstrong withdrew support. The bill has drawn more than 70 amendments and faces intense lobbying from both crypto and banking sectors.

Why Did This Happen?

Bank of America's warning underscores concerns that stablecoins with interest-bearing features could attract a significant portion of bank deposits. This would reduce banks' lending capacity and force them to rely on more expensive wholesale funding.

Moynihan emphasized that stablecoins function more like money market mutual funds than traditional deposits. This distinction is central to the ongoing legislative debate over interest-bearing stablecoins.

The Senate Banking Committee's proposed bill aims to address these concerns by banning passive interest while allowing activity-based rewards. This distinction is intended to preserve incentives for staking and liquidity provision.

How Did Markets React?

The market reaction to X's policy change was immediate. Kaito's token dropped by nearly 20% as the platform revoked API access for apps that reward users for posting.

The price decline reflected concerns about the platform's reliance on X for engagement and visibility. Kaito's NFT floor prices also fell sharply.

BitMine's investment in MrBeast's company was seen as a strategic move into DeFi. The deal is expected to close soon and could expand the company's influence in both content creation and financial services.

What Are Analysts Watching Next?

Analysts are monitoring how the Senate Banking Committee navigates the proposed bill. The bill has drawn more than 70 amendments and faces strong lobbying from both sides.

The impact of the bill on the crypto industry remains uncertain. Some analysts have warned that it could significantly expand financial surveillance powers.

The market is also watching how InfoFi projects adapt to X's new policies. Kaito has already pivoted to a new marketing platform, but other projects may struggle to find alternatives.

The future of DeFi and stablecoins remains a key focus for investors. BitMine's investment in MrBeast's company could signal broader institutional interest in the space.