Piero Cipollone warned that stablecoins could drain bank deposits, with Coinbase falling 1.75% to $157 and Circle losing 6% over five sessions to trade near $60.
summary
- Piero Cipollone has warned that the increasing use of stablecoins could pull deposits away from traditional banks.
- Coinbase shares are testing $157 support, with Compass Point holding the $140 downside target.
- The circuit remains within a bearish channel as Mizuho expects a possible drop to $50.
A member of the European Central Bank’s Executive Board raised the concern during a speech on July 17 at the Union of Cooperative Credit Banks in Rome, linking increased use of stablecoins with a potential decline in customer deposits.
According to According to Cipollone, consumers may become less willing to keep their money in traditional bank accounts if stablecoins gain more widespread use. He said the EU must accelerate the process of a digital euro to protect the role banks play in the financial system and reduce reliance on tokens issued by the private sector.
His comments 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 said He called for changes to Section 404 which would prevent stablecoin companies from offering rewards or payouts through affiliates.
Banking groups have warned that interest-bearing stablecoins could take away deposits from community lenders and impair their ability to provide credit. Circle, which issues the USDC stablecoin, has become particularly vulnerable to the dispute because any restrictions on stablecoin rewards could impact how exchanges and other partners promote USDC.
Stablecoin concerns add pressure to cryptocurrency stocks
Circle shares briefly fell 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 It was purchased for approximately $15.4 million The value of the department’s shares.
Legislative uncertainty also weighed on sentiment. Such as crypto.news I mentionedPresident 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 interests in cryptocurrencies have complicated negotiations.
Coinbase faces a separate risk because changes in US market rules could impact stablecoin revenue, institutional services and trading activity. Compass Point analysts expect Coin to drop to $140 if Congress fails to pass the Clarity Act, arguing that the bill could have a bigger impact on the stock than Coinbase’s second-quarter earnings scheduled for July 30.
Oppenheimer did Lowered Coinbase price target To $209, due to weak trading volumes on the exchange. The revised target remains above the current market price but indicates lower expectations for transaction revenue.
COIN and CRCL remain pinned near key support
On the daily chart, COIN is testing the 78.6% Fibonacci retracement levels at $156.92 after closing near $157.12. A break below this area would expose psychological support at $150, followed by the May low at $139.13, near Compass Point’s $140 target.
COIN’s MACD line crossed its signal line and produced a positive histogram, indicating that the downward momentum has subsided. However, both lines remain below zero, while the RSI remains at 45.77 below the neutral 50 level.
The recovery will first need to clear the $160-165 area before testing the 61.8% Fibonacci level at $170.89.
Circle’s daily chart places CRCL inside a bearish channel that dominated its decline from around $100 in early June. The $58-60 area remains the first support area, while a breakout could expose the $50 level, which matches 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 share price.
CRCL’s MACD formed an early bullish crossover below zero, but a Chaikin Money Flow reading of minus 0.29 shows continued capital outflows. A close above channel resistance around $64-$65 would weaken the bearish position, while another rejection could take shares back toward $58 and Mizuho’s $50 forecast.
