Kraken CEO Clashes With American Bankers Association Over Stablecoin Yields

A public dispute has erupted between Kraken CEO David Ripley and the American Bankers Association (ABA) after a senior ABA executive claimed that allowing crypto exchanges to offer yield on stablecoin would harm traditional banks and their communities.

In a recent statement, Brooke Ybarra, the ABA’s senior vice president of innovation and strategy, argued that paying interest on stablecoin “flies in the face” of their intended purpose as payment instruments rather than savings tools. She warned that such offerings could undermine banks’ ability to serve their customers.

Ripley swiftly fired back, challenging the notion that consumer choice could be harmful. “A detriment to who?” he asked. “Consumers should have the freedom to choose where they hold value and the most efficient way to send that value.”

Ripley: “We’re Building Something Else”

The Kraken chief took aim at the traditional banking sector, accusing it of profiting off customer deposits without sharing the rewards. “Banks have been earning fees on customers’ assets without passing benefits back to them,” Ripley said. “We are building toward something else, a system where services once reserved for the wealthy are accessible to everyone.”

Ripley’s comments resonated with others in the crypto industry. Dan Spuller, head of industry affairs at the Blockchain Association, accused large financial institutions of trying to stifle competition. “Big Banks are ruthlessly targeting our friends at @Coinbase and @KrakenFX to protect their turf,” he said. “Translation: competition’s winning.”

Some stablecoin platforms currently offer yields of up to 5% on deposits. This is well above the U.S. national average savings rate of 0.6%, and even higher than top high-interest bank accounts, which hover around 4%, according to Bankrate. As Solana developer Voss put it, “Bring on the competition, it’s a capitalist world anyway.”

Stablecoin at the Heart of a Financial Shift

The debate comes just months after U.S. President Donald Trump signed the Genius Act, a long-anticipated regulatory framework for stablecoin. The law is seen as a significant step toward bringing digital assets into mainstream finance.

Some industry figures argue that stablecoin may even be safer than traditional bank deposits. Diogo Monica, general partner at Haun Ventures, said in June that many stablecoins are backed by assets held in U.S. Treasury bills or systemically important banks, making them potentially more secure than funds held in commercial bank accounts.

Outside the U.S., tensions between crypto companies and traditional banks continue to grow. A recent Binance Australia survey found that users still face significant banking barriers when accessing crypto exchanges.