Crypto Firms Coinbase Ripple Aim to Become Future Banks as Gen Z Millennials Shift 89%

Pro-crypto lawyer John E. Deaton asserted that Coinbase and Ripple Labs are more than just centralized crypto firms, claiming they are part of what he referred to as the banks of the future. This statement comes at a time when there is a growing interest in crypto, with reports indicating that Gen Z and Millennials are increasingly shifting away from traditional banks towards crypto.

This shift is creating an opportunity for Web3 firms to restructure their business models to capture this emerging market. Deaton, in an X post, stated that "Coinbase, Kraken, Ripple, and Robinhood are the banks of the not-so-distant future." He predicted that these firms will evolve into one-stop shops for various types of loans, including mortgages, consolidation loans, construction loans, car loans, and peer-to-peer loans.

Deaton also predicted that Ripple, despite not currently offering loans as a primary service, could join other firms in providing loans. This entry, however, would depend on Ripple's acquisition of Uphold, based on current speculations. Deaton emphasized that the new financial system is digital, and that crypto-collateral loans, yield, and DeFi platforms that fail to innovate will become obsolete. He noted that people are continuously seeking higher yields and financial independence, concluding that stocks from Coinbase and Robinhood are the future blue-chip stocks.

Deaton's comments were in response to a post from technologist and filmmaker Paul Barron, who highlighted that 89% of Gen Z and Millennials have reported intentions to leave their banks in favor of crypto and DeFi platforms that offer yield, tokenized stocks, and Web3-related services. Barron pointed out that traditional banks like Wells Fargo and Bank of America are in a state of panic due to this shift.

The latest prediction from Deaton has sparked discussions about more crypto firms joining the traditional financial system. Crypto firms in regions with innovation-friendly regulations may emerge as competitors or partners to Ripple and Coinbase. Circle Internet Group, the issuer of USD Coin (USDC), the second-largest stablecoin by market capitalization, stands out as a likely candidate. However, challenges lie ahead, as some market participants raised concerns that centralized crypto companies becoming traditional banks feels like a step backward. They pointed out that true DeFi protocols running on decentralized chains offer the same services without the middlemen.

Despite these concerns, the trend is changing across the board. Circle recently applied for a banking license in the United States, aiming to create a national trust bank. If approved, this license would allow Circle to settle payments directly, bypassing intermediaries. Following Circle's lead, Ripple also disclosed plans to apply for a banking license in the US. Ripple CEO Brad Garlinghouse confirmed that if approved, the license would set a new benchmark for trust in the stablecoin market. These moves reflect a broader push by crypto firms towards deeper integration with the traditional financial system amid emerging regulatory clarity.