JPMorgan executives Umar Farooq and Peter Muriungi have issued a warning about the potential risks of yield-bearing stablecoins evolving into 'shadow banks'. In a joint article, they urged the U.S. to establish a comprehensive regulatory framework for digital assets. While acknowledging the innovative potential of tokenized and programmable money for global payments and 24/7 settlements, they cautioned that allowing stablecoins to offer yields could lead to risks akin to shadow banking. The banking industry is concerned that yield-bearing stablecoins might squeeze bank deposits and threaten credit availability. Farooq and Muriungi emphasized that offering rewards or cashback on stablecoin balances without the regulatory standards of traditional deposit products could increase consumer confusion and the risk of runs. They advocate for stablecoins to adhere to the same regulatory standards as deposit products and ensure anti-money laundering tools are not overlooked.