Piero Cipollone has warned that stablecoins could drain bank deposits as Coinbase fell 1.75% to $157 and Circle lost 6% across five sessions to trade near $60.
Summary
- Piero Cipollone warned that growing stablecoin use could pull deposits away from traditional banks.
- Coinbase shares are testing $157 support, with Compass Point maintaining a $140 downside target.
- Circle remains inside a descending channel as Mizuho forecasts a potential drop to $50.
The European Central Bank executive board member raised the concern during a July 17 speech at the Federation of Cooperative Credit Banks in Rome, where he linked increased stablecoin use with a possible decline in customer deposits.
According to Cipollone, consumers may become less willing to keep money in conventional bank accounts if stablecoins gain wider use. He argued that the European Union should speed up the digital euro to protect the role banks play in the financial system and limit reliance on privately issued tokens.
His comments have added a European voice to concerns already raised by US banking groups during negotiations over the CLARITY Act. In a letter to the Senate, the groups called for changes to Section 404 that would stop stablecoin companies from offering rewards or yield through affiliated firms.
Banking groups warned that interest-bearing stablecoins could pull deposits from community lenders and weaken their ability to provide credit. Circle, which issues the USDC stablecoin, has become especially exposed to the dispute because any limits on stablecoin rewards could affect how exchanges and other partners promote USDC.
Stablecoin fears deepen pressure on crypto stocks
Circle shares briefly dropped to $58 during pre-market trading on July 17, their lowest level since February 2026, before recovering toward $60.46. The decline continued even after Cathie Wood’s ARK Invest purchased about $15.4 million worth of Circle shares.
Legislative uncertainty has also weighed on sentiment. As crypto.news reported, President Donald Trump met with senators on July 16 as Republicans tried to resolve disputes holding up the CLARITY Act. The bill requires Democratic support in the Senate, where disagreements over ethics provisions and Trump’s crypto interests have complicated negotiations.
Coinbase faces a separate risk because changes to US market rules could affect stablecoin revenue, institutional services and trading activity. Compass Point analysts forecast that COIN could fall to $140 if Congress fails to pass the CLARITY Act, arguing that the bill may have more influence on the stock than Coinbase’s second-quarter earnings scheduled for July 30.
Oppenheimer has lowered its Coinbase price target to $209, citing weak trading volumes on the exchange. The revised target remains above the current market price but points to reduced expectations for transaction revenue.
COIN and CRCL remain pinned near key support
On the daily chart, COIN is testing the 78.6% Fibonacci retracement at $156.92 after closing around $157.12. A break below this area would expose the psychological support at $150, followed by the May low at $139.13, close to Compass Point’s $140 target.
COIN’s MACD line has crossed above its signal line and produced a positive histogram, suggesting that bearish momentum has eased. Both lines remain below zero, however, while the relative strength index at 45.77 stays under the neutral 50 level.
A recovery would first need to clear $160–$165 before testing the 61.8% Fibonacci level at $170.89.
Circle’s daily chart places CRCL inside a descending channel that has controlled its slide from roughly $100 in early June. The $58–$60 zone remains the first support area, while a breakdown could expose $50, matching Mizuho’s downside target.
Mizuho analysts also warned that the new OpenUSD stablecoin could take market share from Circle, adding another risk to CRCL’s stock price.
CRCL’s MACD has formed an early bullish crossover below zero, but the Chaikin Money Flow reading of minus 0.29 shows continued capital outflows. A close above the channel resistance around $64–$65 would weaken the bearish setup, whereas another rejection could send the shares back toward $58 and Mizuho’s $50 forecast.
