Banks found a way to copy stablecoins without losing the money that funds their loans
Banks defend themselves against stablecoins by saying they are building tokenized deposits to modernize payments, with programmable money and around-the-clock settlement.
Falcon Finance chief RWA officer Artem Tolkachev told CryptoSlate that the explanation covers only half the reason:
“It is the balance sheet, not the technology.”
A tokenized deposit keeps the money a stablecoin would move off a bank's balance sheet, leaving it as a deposit the bank can still lend against. Tolkachev said:
“A stablecoin competes with the deposit. A tokenized deposit is the deposit, just programmable.”
Underneath stablecoins and tokenized deposits Tolkachev said that, to whoever is holding them, a tokenized deposit, a reserve-backed stablecoin, and an overcollateralized synthetic dollar look identical.
In the case of a tokenized deposit, the $100 million sits on one bank's balance sheet. The bank earns the return by lending it out, and the holder carries that bank's credit risk, though the position still counts as an insured deposit.
The FDIC's position backs that reading, saying tokenization changes a deposit's form while leaving its substance intact.
In a reserve-backed stablecoin, the money moves into the issuer's reserves, and the issuer earns the yield on those reserves. The holder carries the issuer's operational and reserve risk with no claim on the upside, since the GENIUS Act bars issuers from paying that yield to holders. No deposit insurance sits behind the position.
In an overcollateralized synthetic dollar, the token is backed by more collateral than its face value, held apart from the issuer. The return depends on how that collateral is managed, and the holder's protection comes from the size of the overcollateralization and the separation between custody and the issuer itself.
Tolkachev noted that this is the “same face value” with “three different risk owners,” adding that the key question is where the money sits and who can touch it.
Digital dollar format Where the $100M sits Who earns the economics What the holder relies on Tokenized deposit On the issuing bank’s balance sheet The bank, through lending and balance-sheet use Bank credit, supervision, and applicable deposit insurance Reserve-backed stablecoin In the stablecoin issuer’s reserve assets The issuer/reserve structure Reserve quality, issuer operations, and redemption process Synthetic dollar In a separate collateral/custody structure Depends on the collateral strategy Overcollateralization, custody separation, and liquidation mechanics The fight is over funding, and it starts before deposits leave The Dallas Fed said in July that a deposit token stays a commercial-bank deposit, remains on the issuing bank's balance sheet, settles at par, and sits inside the same supervisory framework as any other deposit.
The FDIC's April proposal stated that deposits held as stablecoin reserves would be insured to the stablecoin issuer as a corporate deposit, with individual stablecoin holders carrying no pass-through insurance claim of their own.
Deposit insurance itself should apply the same way regardless of which technology records the underlying deposit liability.
Tolkachev also argued that, if stablecoins pull deposits away from banks, the first effect is higher funding costs, and it shows up before anyone notices deposits leaving. A bank that loses cheap, sticky deposit funding has to replace it with pricier wholesale money to keep lending at the same level, compressing margins before lending itself gets cut back.
He added that the pattern is “argued over more than measured,” with current research treating it as a plausible channel still awaiting real documentation.
