The US crypto industry's main policy effort, the Digital Asset Market Clarity Act, has been stalled due to disagreements over stablecoin yields. Bankers have argued that these yields could lure depositors away from traditional banks, while the White House claims that they do not pose a significant threat. The American Bankers Association has released a study that disputes the White House's claim, stating that the council of economic advisers analyzed the wrong scenario.
The ABA argues that allowing stablecoin yields could lead to a significant migration of deposits out of traditional banks and into stablecoin markets, which could scale rapidly from $300 million to $2 trillion. The study suggests that this could have severe consequences for community banks, which may not benefit from the deposits of leading stablecoin issuers. The conflict over stablecoin yields has derailed the Senate legislation for months, with lawmakers struggling to find a compromise that addresses the concerns of both the banking and crypto industries.