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DeFi & Yields

Bank Deposit Rates vs DeFi Yields

· Updated monthly

As of June 2026, DeFi yields are 8× higher than the average US bank savings rate. Aave V3 USDC pays 3.14%; the FDIC national savings rate is 0.38%. The +276 bps gap is the underlying signal Bank of America CEO Brian Moynihan publicly warned about in June 2026 when he said stablecoin yields could drain up to 35% of US bank deposits. The aggregate US banking system's actual implied cost of funds, computed from FDIC quarterly Call Reports, is 2.27%, roughly 6× the rate the average US bank pays its retail savers. The Federal Reserve pays banks 3.65% on reserve balances. Data: FDIC National Rates archive, FDIC BankFind Call Reports, FRED IORB & TB3MS, DefiLlama Aave V3. Monthly axis from April 2021.

Bottom Line

The average US savings account pays 0.38% in June 2026. DeFi lending on Aave V3 pays 3.14%, about 8× more. The US banking system as a whole pays a blended 2.27% on deposits, meaning even banks themselves pay roughly 6× the consumer savings rate to their wholesale, brokered, and CD depositors. The Federal Reserve pays banks 3.65% on reserves, leaving a +1.38% risk-free intermediation margin that the banking system captures and that stablecoin issuers structurally compete for.

Bank Savings
0.38%
FDIC national average
What Banks Actually Pay
2.27%
implied cost of funds, all US banks blended
Aave V3 USDC
3.14%
monthly median base APY
DeFi vs Savings Gap
+2.76%
Wide Gap · 8× ratio
IORB (Fed → banks)
3.65%
interest on reserve balances
3M T-Bill
3.60%
FRED TB3MS, the risk-free benchmark
Bank Deposit Moat
+1.38%
risk-free margin banks earn for being intermediaries
Aave vs Bank Reality
+0.87%
DeFi premium over implied cost of funds

Where a US Dollar Can Earn Yield, by Month

Five comparable lanes for parking a US dollar, plotted on a single monthly axis from April 2021 onward. Bank Savings (green) is the FDIC national average consumer savings rate. What Banks Actually Pay (purple, stepped) is the implied cost of funds for the entire US banking system, computed from quarterly Call Reports, higher than the consumer savings rate because it includes CDs, brokered deposits, and money-market balances. Aave V3 USDC (blue) is the leading DeFi lending yield, monthly median to suppress single-day spikes. 3-Month T-Bill (orange dashed) and IORB (red dashed) are the risk-free benchmarks. Coloured bands mark each Fed policy regime; the orange marker tags BofA's June 2026 warning. Click any legend item to hide a series.

What this page does not show

The yield gap is documented. The deposit-flight thesis, that the gap will cause material migration from banks to stablecoins, is not. The chart is a description of the incentive landscape, not a forecast. Several risks the bank-vs-DeFi comparison cannot capture:

  • FDIC insurance. US bank deposits up to $250,000 are insured against bank failure. Stablecoin deposits are not. The bank yield is a lower-but-insured number; the DeFi yield is a higher-but-uninsured number, different risk surfaces, not different points on the same risk curve.
  • Stablecoin depeg risk. USDC briefly traded at $0.88 during the SVB failure in March 2023. The chart assumes the stablecoin holds its dollar peg; a 5% depeg wipes out a year of yield advantage.
  • Smart-contract risk. Aave V3 has a multi-year audit history and a battle-tested liquidation engine, but the Kelp DAO / Aave bad-debt incident in 2025 shows tail risks are real.
  • Tax treatment. Bank interest is straightforward income. DeFi yield can trigger crypto-tax reporting complexity that meaningfully reduces the net-of-tax yield, especially for non-US savers.

A reasonable framing: the gap is real and large, but it sets the incentive, the migration depends on consumer awareness, on-ramp friction, regulatory clarity, and individual risk tolerance. None of those are on the chart.

How to Read This Page

The four boxes below frame what each major Fed-policy period did to the gap. The bank deposit rate adjusts slowly, banks raise it deliberately and reluctantly because every basis point raises the cost of $19 trillion in liabilities. DeFi yield adjusts continuously through pool utilization. The gap between the two has historically been large during low-rate eras (when DeFi yield from crypto demand exceeds zero T-bill rates by a wide margin) and at the start of cutting cycles (when T-bill yields drop fast but bank savings rates drop even faster).

2021 · Savings ~0.05%, Aave ~3–5%
Zero-Rate Era: DeFi Yield Dominant

With Fed funds at the lower bound, T-bill yields were near zero and US bank savings rates followed. Aave USDC paid 3–5% from organic borrow demand, a gap of roughly 5 percentage points. The yield asymmetry helped power the $5B → $180B expansion of stablecoin supply through 2021.

For consumers: The economic incentive to migrate deposits to on-chain dollar yield was already structural in 2021, long before the press attention. The reason mass migration did not occur was friction and trust, not yield math.

2022–mid 2023 · Hike cycle, T-bill rises faster than savings or DeFi
Rate Hike Cycle, T-Bills Compress the Gap

The Fed raised rates from 0 to 5.25% in 14 months. T-bill yields followed mechanically; FDIC savings rates barely moved (still 0.30% by end-2022). Aave USDC declined as crypto activity contracted. For the first time in years, the FDIC savings rate vs Aave gap narrowed in absolute terms, while T-bills became the obvious winner over both.

For institutional treasury teams: Hike cycles compress the DeFi-vs-savings gap but expand the T-bill-vs-savings gap. Both signal capital outflow from bank deposits.

Late 2023–mid 2024 · Rates held at 5.25–5.5%
High-Rate Pause: Bank Spread Peaks

IORB at 5.4% while implied bank cost of funds was roughly 2.5–3%. Banks earned a wide spread on every dollar parked at the Fed, the "Fed-funded bank profit" that politicians and bank CEOs began to debate publicly. Stablecoin yields recovered from their 2022 lows; the deposit-vs-DeFi gap re-widened as crypto demand returned.

For policy analysts: The 2024 bank spread is the political backdrop to stablecoin legislation. The implied cost of funds underperformed IORB by 2+ percentage points, a transfer that stablecoin reserves capture for issuers rather than holders.

Sept 2024 → present · Cutting cycle
Cutting Cycle: Bank Savings Lags, Gap Persists

Fed cuts pulled T-bill rates down faster than bank deposit rates, which barely budged. Aave USDC held in the 4–6% range. The FDIC-vs-Aave gap remains in the 4–5 point range. By June 2026 the gap was +2.76%, the headline backdrop to Bank of America's June 2026 deposit-flight warning.

For consumers: Cutting cycles are when the gap is most visible because T-bills no longer dominate the comparison. For bank executives: The lag between deposit-rate adjustment and DeFi-yield adjustment is the structural risk in the deposit-flight thesis.

Methodology

FDIC consumer deposit rates: Monthly national-average rates for Savings, Interest Checking, Money Market, and CDs (1–60 months), published by the FDIC on the 3rd Monday of each month at fdic.gov/resources/bankers/national-rates. We chart Savings as the consumer baseline. Backfilled from the FDIC Excel archive (April 2021 onward).

National Rate Cap (mentioned but not charted): Each month the FDIC also publishes a regulatory ceiling, the higher of (national average + 75 bps) or (relevant Treasury yield + 75 bps). Banks classified as less-than-well-capitalized cannot legally pay above the cap. Well-capitalized banks are not bound by it, but in practice almost no large bank pays close to the cap.

US banking system implied cost of funds: Computed from FDIC BankFind quarterly Call Report aggregates. For each quarter end we sum the EINTEXP (interest expense, in thousands USD) and DEP (total deposits) across all 4,600+ FDIC-insured banks. EINTEXP is reported year-to-date so we differentiate it within each fiscal year (Q1 fresh, Q2 = YTD-Q1, Q3 = YTD-Q2, Q4 = YTD-Q3), annualize the per-quarter figure (× 4), and divide by total deposits. The result is the blended weighted-average interest rate the US banking system paid on all deposit liabilities. Quarterly data forward-filled to the monthly axis. Source: api.fdic.gov/banks/financials.

3-Month T-Bill (TB3MS): Secondary market 3-month US Treasury bill rate from FRED, monthly observation. Downsampled to month-end value.

IORB: Interest on Reserve Balances paid by the Federal Reserve to banks on reserves held at the Fed, FRED series. Daily, downsampled to month-end.

Aave V3 USDC: Base supply APY on Aave V3 (Ethereum mainnet), source DefiLlama Yields API, daily observation. Downsampled to the calendar-month median to suppress single-day liquidity spikes that do not reflect what a saver would actually earn over a full month, a single 3-day spike to 12% does not change a median, but would double an arithmetic mean.

Fed regime bands: Coloured background bands reflect the FOMC's policy stance, zero-rate (Mar 2020 → Mar 2022), hike cycle (Mar 2022 → Sep 2023), high-rate pause (Sep 2023 → Sep 2024), and cutting cycle (Sep 2024 → present). Set to documented FOMC meeting dates, not interpolated.

BofA event annotation: The orange marker at June 2026 corresponds to Bank of America CEO Brian Moynihan's public statement that stablecoin yields could drain up to 35% of US bank deposits, the news event that elevated this chart from a structural curiosity to an industry talking point.

Why monthly? FDIC publishes monthly. The Call Report aggregates are quarterly. Forcing all series to a daily axis would either repeat monthly values 30× (visually misleading) or extrapolate values that do not exist. A monthly axis is the most honest cadence at which all five series are jointly meaningful.

Update cadence: Monthly, on the Tuesday after FDIC publishes (3rd Monday of each month + 1 business day). The BankFind Call Report aggregates revise as banks file (a 60–75 day filing window), so the most recent quarter is provisional for the first 2 months after quarter-end.

Related Indicators
DeFi & Yields
Stablecoin Yield Landscape
The companion piece: instead of bank-vs-DeFi, this page compares five yield-bearing stablecoin products (sUSDe, sUSDS, USDY, BUIDL, syrupUSDC) against each other and against the bank floor. Risk-source colour coding makes the trade-off visible.
DeFi & Yields
DeFi Yield Spread vs T-Bills
The daily-cadence companion: Aave USDC APY minus the 3M T-bill, the bird's-eye view of when DeFi pays a premium over risk-free.
DeFi & Yields
Multi-Pool Lending Yields
Picks the highest-paying venue across Aave V3 + Compound V3 on Ethereum and Arbitrum, once the macro signal says DeFi is competitive.
Macro Environment
SOFR & Short-Term Rates
The Fed-policy backdrop that drives every line on this chart. SOFR sets the rate environment within which both bank deposit rates and DeFi yields move.
Macro Environment
US Inflation (CPI)
Real return on bank deposits = savings rate minus CPI. The gap between nominal and real makes the relative attractiveness of stablecoin yield even clearer.
Market Dynamics
Redemption Pressure Gauge
If deposit-flight is actually happening, stablecoin supply expands rather than contracts. The 30-day per-coin flow gauge is where it would show up first.
Market Dynamics
Supply Shock Index
Total stablecoin market cap percent change over 30 days. The aggregate companion to the redemption pressure gauge.
Frequently Asked Questions
Is DeFi yield really higher than my bank?
As of June 2026, yes, by a wide margin. The FDIC national average savings rate is 0.38% and Aave V3 USDC lending pays 3.14%, a gap of +276 bps (8× the bank rate). The gap is structural: consumer savings rates barely respond to Fed-funds moves, while DeFi yields track real-time on-chain borrowing demand. Even the broader US banking system pays only 2.27% on its blended deposit base, roughly 6× the headline consumer savings rate.
How much more does Aave pay than a Bank of America savings account?
Bank of America's standard Advantage Savings rate has hovered around 0.01% to 0.04% APY through 2024–2026, well below the FDIC national average of 0.38% which itself includes higher-paying community banks and online banks. Aave V3 USDC lending pays 3.14% in June 2026. The gap between BofA standard savings and Aave is on the order of 75–150× the bank yield, not just 8×. This asymmetry is what BofA CEO Brian Moynihan warned about publicly in June 2026 when he said stablecoin yields could drain up to 35% of US bank deposits.
Should I move my savings to a stablecoin?
This page does not give financial advice. What it does show is the gap: bank savings yields a fraction of what stablecoin-denominated lending pays. The decision involves trade-offs the chart cannot capture. Bank deposits up to $250,000 are FDIC-insured against bank failure; stablecoin deposits are not. Stablecoins themselves can depeg (USDC briefly traded at $0.88 during the Silicon Valley Bank failure in March 2023). DeFi lending carries smart-contract risk (the Kelp DAO bad-debt incident on Aave in 2025 is the canonical example). A reasonable framing is: the yield gap is real and large, but the risk surfaces are different, not necessarily worse, but different. A blended portfolio allocation that includes some stablecoin yield within an explicit risk budget is a more conservative use of the gap than wholesale migration.
What does this chart compare?
The chart overlays four very different ways a US dollar can earn yield, all on the same monthly axis. The bank savings line is the FDIC national average, what a typical US bank pays on a deposit account. The implied cost of funds is the total interest expense paid by all FDIC-insured banks divided by total deposits, annualized, what banks actually pay in aggregate. The DeFi line is the Aave V3 USDC supply APY, the largest decentralized lending venue. The 3-month T-bill is the risk-free benchmark, and IORB is what the Federal Reserve pays banks on their reserve balances.
Why is the bank-implied cost of funds higher than the savings rate?
The savings rate is just the rate on basic savings products. The implied cost of funds includes everything banks pay on every type of deposit: checking, savings, money market, CDs, and brokered or wholesale funding. Banks pay much more on CDs and brokered deposits than on demand savings, so the system-wide blended cost is always higher than the consumer-facing savings rate. The gap between the two numbers is the cross-subsidy: banks fund themselves cheaply through retail savers and pay competitive rates only on the deposits that demand it.
What is the "deposit-flight" thesis the BofA CEO warned about?
In June 2026, Bank of America CEO Brian Moynihan publicly warned that stablecoin yields could drain up to 35% of US bank deposits. The thesis is mechanical: banks pay savers a fraction of a percent while stablecoin lending protocols pay multiples more. As consumer awareness of the gap grows and as on-ramps simplify, retail and institutional capital migrates from non-interest and low-interest bank accounts into stablecoin-denominated yield. The chart shows the gap underlying that thesis. It does not prove that flight is happening, only that the incentive exists.
How is the implied cost of funds computed?
Quarterly Call Report data published by the FDIC BankFind API exposes per-bank totals for interest expense (EINTEXP), interest income (INTINC), total deposits (DEP), and total assets (ASSET). We sum EINTEXP and DEP across all 4,600+ FDIC-insured banks for each quarter end, convert the YTD EINTEXP figure into a per-quarter figure (Q2-Q1, Q3-Q2, Q4-Q3 within each fiscal year), then annualize and divide by deposits: implied cost = (quarterly EINTEXP × 4) / deposits. The result is the blended weighted-average interest rate the US banking system paid on all deposit liabilities in that quarter.
Why does Aave USDC APY look more variable than the bank rate lines?
On-chain lending APY is set continuously by pool utilization and can move several percentage points within a single week if borrowing demand spikes or contracts. Bank deposit rates are administrative prices that banks adjust deliberately, typically lagging the Fed by months. We chart the monthly mean of Aave USDC base APY to make the comparison fair: a one-day spike does not represent the actual yield a saver would earn over time.
Does the FDIC limit how much banks can pay savers?
Indirectly, yes. The FDIC sets a National Rate Cap each month, equal to the national average rate plus 75 basis points, or the relevant Treasury yield plus 75 basis points, whichever is higher. Banks classified by their primary regulator as less than well-capitalized cannot legally pay above the cap. Well-capitalized banks are not bound by the cap and can pay any rate they choose, but in practice almost no large bank pays close to the cap because lower-paying competitors are profitable. We show the savings rate cap on the chart as a dashed reference line.
What does the bank spread (IORB minus implied cost) measure?
The Federal Reserve pays interest on bank reserve balances at IORB (currently around 4.40%). Banks earn this on reserves parked at the Fed and pay out their implied cost of funds on deposits. The difference is roughly the risk-free margin banks earn just for being an intermediary between depositors and the Fed, currently somewhere between 2 and 3 percentage points. This margin is what stablecoin issuers (Tether, Circle, PayPal) effectively capture for their shareholders rather than pass to token-holders, and it is what some institutional stablecoin proposals (yield-bearing stablecoins, tokenized money-market funds) aim to redistribute to holders.