Austin Campbell, founder and CEO of Zero Knowledge, argues that stablecoins cannot cause a net flight of deposits because their issuance and redemption transfer deposits between accounts or banks without reducing the system-wide total. On CoinDesk’s The Policy Protocol podcast, published around October 23, 2026, he acknowledges that an individual bank may lose deposits to a competitor but says the overall pool remains unchanged. He portrays stablecoins as closer to cash or money-market instruments than leveraged bank deposits, particularly when their reserves consist of Treasury bills or repurchase agreements. Responding to the American Bankers Association and the Independent Community Bankers of America, which fear that yield-bearing stablecoins could attract deposits, Campbell considers their concerns misinformed. The debate comes as the OCC finalizes stablecoin rules and JPMorgan launches JPMD, a tokenized deposit on Ethereum that remains a bank liability, unlike stablecoins according to Campbell, who previously managed reserves for Paxos’ BUSD, a stablecoin that peaked above $20 billion.
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