Say cryptocurrencies take off and people hold more of their savings in crypto instead of bank deposits. Currently everyone's savings is in bank accounts which is being lent out to businesses and hence stimulating the economy. What is going to happen if bank deposits drastically decrease?
On the one hand, maybe it will not have much effect on the economy because since lending will become tighter, businesses will need to justify the loans more (vs. if there is easy access to money) and will create stronger proposals. On the other hand, could it have a detrimental effect on the economy?
Logically bank deposits can increase if you assume bitcoin investments and savings are substitutes. I think that the relationship isn't nearly as strong as you feel. Mostly people invest a much smaller amount than they save. But less deposits in turn could lead to banks needing to put up interest rates to encourage saving.