Report: Coinbase Says It May Withdraw Support for Senate Crypto Legislation

crypthub

about 8 hours ago

Coinbase Threatens Legislative Pull‑back

Coinbase warns it may withdraw support for the Senate market‑structure bill if stablecoin rewards are banned. The 3.5% APY on USDC accounts yields about $1.3 billion in yearly revenue for the exchange. A Senate markup is slated for Jan 15, heightening the deadline pressure.

Banking Lobby Pushes for Yield Limits

Banking groups, headed by the American Bankers Association, urge broader yield limits that restrict rewards to regulated banks. They claim yield‑bearing stablecoins could siphon deposits from community banks and hurt local borrowers. Coinbase is pursuing a national trust charter to keep incentives while meeting tighter rules.

Political Landscape and Market Impact

Bipartisan backing for the bill is eroding as midterms approach, and some committees may postpone votes. Analysts now estimate under a 70% chance of passage in the first half of the year. Crypto firms say they will craft alternative incentives, turning regulation into a whack‑a‑mole battle.