Circle CEO Says Stablecoins Can Power AI Payments Globally
- Circle CEO says stablecoins can handle billions of AI-driven payments at scale.
- US lawmakers debate yield limits as banks warn of deposit migration risks.
- Money market fund growth shapes stablecoin yield comparisons in policy talks.
Circle CEO Jeremy Allaire said stablecoins remain critical digital infrastructure as U.S. lawmakers debate tighter yield rules. He said stablecoins can support billions of transactions for artificial intelligence agents while coexisting with traditional banking structures. His remarks surfaced during regulatory debates over stablecoin yields and broader concerns about deposit migration from banks.
Allaire spoke during digital asset infrastructure panels as Congress reviewed draft language under the CLARITY Act. The proposal triggered backlash in January 2026 after lawmakers moved to restrict passive yield on stablecoin holdings. The debate followed earlier legislation that reshaped stablecoin oversight in the United States.
Stablecoins and Artificial Intelligence Transactions
Allaire stated that stablecoins remain the only system capable of handling transaction volumes required by AI agents. He said future AI systems may execute billions of automated payments that demand constant liquidity and instant settlement. According to Allaire, existing payment rails cannot match that scale without friction.
Industry executives echoed similar projections during public forums on digital finance.
Galaxy Digital CEO Michael Novogratz said in September 2025 that AI agents may soon dominate stablecoin usage. He cited automated purchasing and machine-driven commerce as likely demand drivers.
Former Binance CEO Changpeng Zhao made related claims at Davos. He said crypto payments could enable AI-led commerce across global markets. Yet public examples remain limited to experimental deployments rather than live systems.
Yield Debate and Banking Sector Warnings
Allaire compared stablecoin yields to money market funds during public discussions.
He said government money market funds expanded for decades without triggering systemic bank disruptions. He did not provide timelines or quantified impacts in available remarks.
Banking groups warned lawmakers about deposit erosion risks. The Kansas City Federal Reserve estimated that yield-bearing stablecoins could remove $1.5 trillion in lending capacity. Representatives said deposit migration could weaken traditional credit intermediation.
U.S. money market funds now hold about $7.7 trillion in assets, according to the Investment Company Institute. Balances rose by $868 billion over the past year despite Federal Reserve rate cuts. Critics note that money funds operate under different regulatory and insurance frameworks than stablecoins.
Legislative Framework and Regulatory Friction
The GENIUS Act, whichwas passed in 2025, made it illegal for issuers to pay interest directly to their bondholders. Crypto platforms argued the law still permitted third-party yield programs to operate.
The interpretation of that law created the framework for subsequent policy conflicts. Draft CLARITY Act language sought to close that gap. The proposal would ban passive yield for holding stablecoins while allowing rewards tied to transaction activity. Lawmakers postponed progress because industry objections became known.
Related: Hong Kong Prepares Stablecoin Licenses for Digital Finance
Circle’s comments place stablecoins at the center of two debates: artificial intelligence payments and U.S. financial regulation. Lawmakers weigh yield limits as banks warn of deposit risks, while industry leaders frame stablecoins as neutral infrastructure. With AI transaction volumes rising and legislative language unsettled, regulatory choices may shape how digital dollars integrate with banking and automated commerce going forward globally.
The question of whether lawmakers can create financial stability regulations without restricting stablecoin usage, which supports emerging AI-based transactions, remains vital as Congress evaluates the proposed changes.
