- White House crypto talks spark optimism for stablecoin regulation breakthrough.
- Banking groups push for stablecoin yield bans, crypto advocates disagree.
- Crypto industry urges swift action on market structure bill progress.
A pivotal meeting between crypto and banking industry leaders, hosted by the White House, has stirred optimism about a potential breakthrough on stablecoin regulations. Ripple’s legal chief, Stuart Alderoty, described the session as “productive,” signaling that compromise might be within reach. He emphasized the need for lawmakers to act quickly, highlighting strong bipartisan support for sensible crypto market legislation.
Disagreements Persist Over Stablecoin Yield Payments
This meeting marked the second such session in two weeks, aimed at finalizing provisions for stablecoins in the upcoming market structure bill. While the House passed the CLARITY Act in July, progress has stalled in the Senate. The bill seeks to define how US regulators will oversee the crypto market, but significant disagreements remain, particularly over the issue of yield payments tied to stablecoins.
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Banking groups like the American Bankers Association and the Bank Policy Institute have raised concerns over the risks that yield payments on stablecoins pose to traditional banking systems. They argue that such rewards could destabilize bank deposits and undermine the broader financial system. In a handout provided at the meeting, the banking sector reiterated its push for a ban on yield payments to stablecoin holders.
Crypto Advocates Call for Swift Action on Market Structure
On the other hand, crypto advocates continue to argue that stablecoin rewards are an essential part of the industry’s infrastructure. Some, like BitGo CEO Mike Belshe, are urging both sides to stop revisiting old legislation, such as the GENIUS Act, which already banned direct yield payments. According to Belshe, the focus should now be on passing the market structure bill without further delay.
Despite these divides, both sides have acknowledged that more discussions are needed to move forward. The goal remains to find a middle ground that satisfies both the concerns of the banking sector and the rapidly evolving needs of the crypto industry. As discussions continue, the window for compromise is still open, but the outcome remains uncertain.
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