The US crypto industry's key legislative effort, the Digital Asset Market Clarity Act, remains stalled due to disagreements over stablecoin yield. Bankers recently countered a White House economists' report, arguing that it misjudged the risks. The American Bankers Association claims the White House analyzed the wrong scenario, focusing on a ban on stablecoin yield rather than its potential consequences if allowed. ABA economists argue that prohibiting yield on payment stablecoins is a necessary precaution to prevent them from becoming a risky substitute for insured bank deposits.
This debate has stalled the 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.
The banking industry warns that failing to intervene in stablecoin yield could lead to a rapid scaling of stablecoin markets, potentially accelerating the migration of funds out of bank deposits.