Banks want to amend stablecoin laws, crypto industry opposes

Major banking associations in the U.S. are working to persuade the Senate to repeal some key provisions of the recently passed stablecoin law, leading to a direct confrontation with lobbying organizations in the cryptocurrency sector.

Conflict of interest

Banking groups, representing over 50 associations, have called on the Senate to use an upcoming crypto bill to amend the #GENIUS Act. They particularly want to:

Prohibit exchanges like Coinbase from paying interest to users on stablecoins.

Revoke the provision that allows licensed stablecoin issuers in one state to operate nationwide.

Banks are concerned that without these changes, $6.6 trillion could flow from insured bank accounts into the unregulated stablecoin sector.

Response from the Crypto Industry

Two leading cryptocurrency lobbying groups, the Blockchain Association and the Crypto Council for Innovation, have firmly opposed the banks' requests. They argue that these changes aim to "protect banks at the expense of industry growth, competition, and consumer choice."

Groups #crypto also reject the argument that large capital flows will leave the banking system, stating that such conclusions are "economically unrealistic." They emphasize that banning interest on stablecoins while allowing bank interest would create an uneven playing field, favoring traditional financial institutions. #anh_ba_cong