Banks and crypto firms collide as stablecoins, ETFs and on‑chain stock lending advance

A sharp fault line is emerging in the digital asset industry as crypto products that resemble regulated financial services meet warnings from traditional banks. This week JPMorgan cautioned that yield-bearing stablecoins could recreate core banking functions without longstanding safeguards, even as Wall Street moves deeper into crypto via ETF filings and other initiatives.

JPMorgan’s chief financial officer Jeremy Barnum, speaking on the bank’s fourth‑quarter earnings call, warned that "the creation of a parallel banking system that sort of has all the features of banking, including something that looks a lot like a deposit that pays interest, without the associated prudential safeguards ...

is an obviously dangerous and undesirable thing." The bank has expressed interest in blockchain and stablecoins but said interest-bearing versions pose significant risks, a stance Cointelegraph noted last May. Binance Research described recent S‑1 filings by Morgan Stanley for proposed Bitcoin and Solana ETFs as a potential "structural pivot" in institutional adoption.

The report said Morgan Stanley’s filings could pressure other major banks, including Goldman Sachs and JPMorgan, to accelerate their own crypto strategies to remain competitive. Crypto-native firms are also pushing into regulated territory.

Key Topics

Crypto, Jpmorgan, Stablecoins, Morgan Stanley, Bitcoin Etf, World Liberty