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>>Stablecoin Yield No Longer a Viable Option: White House Tightens Focus on Reward Discussions in Latest Meeting

Stablecoin Yield No Longer a Viable Option: White House Tightens Focus on Reward Discussions in Latest Meeting

crypthub

about 7 hours ago

White House Mediates Stablecoin Dispute

The White House took a leading role in a recent Crypto Council meeting, addressing the stablecoin yield dispute that delayed the CLARITY Act. Representatives from Coinbase, Ripple, and the Blockchain Association participated, while banks were represented through trade associations. The meeting marked a shift, with the White House steering discussions rather than industry groups.

Banking Concerns Over Stablecoin Legislation

Banks criticized the GENIUS Act for potential risks, arguing that allowing interest on stablecoins could distort financial markets. They pushed for the CLARITY Act to ban yield on stablecoins for exchanges and brokers. The Senate draft proposed rewards for specific actions but prohibited interest for passive holders, prompting crypto industry opposition.

Draft Text and Ongoing Negotiations

A White House draft acknowledged bank concerns, removing yield on idle balances but allowing activity-linked rewards. The draft included anti-evasion measures with penalties for violations. Banking representatives will assess if compromises on stablecoin rewards are possible, with talks continuing toward an end-of-month deadline.