The US crypto industry's main legislative push, the Digital Asset Market Clarity Act, remains stalled due to disagreements over stablecoin yields. Bankers argue that these yields pose a threat to traditional bank deposits, contradicting a recent White House report. The American Bankers Association claims the White House economists focused on the wrong scenario, analyzing the effects of a ban on stablecoin yields instead of considering the implications of allowing such yields. ABA economists believe that prohibiting yield on payment stablecoins is a necessary precaution to prevent them from becoming a risky alternative to insured bank deposits.
This debate has delayed Senate legislation for months, with lawmakers attempting to find a compromise. The proposed Clarity Act aims to regulate US crypto markets, but its progress is uncertain. Bankers warn that without intervention, stablecoin markets could rapidly expand, leading to a significant migration of funds out of bank deposits.
The absence of a resolution may hinder the bill's chances of passing through the Senate.