Banks Push for Tighter Stablecoin Rules as Senate Prepares for Clarity Act Vote

A broad coalition of U.S. banking groups is pushing for tighter restrictions on stablecoin interest and rewards in the Clarity Act, ahead of a Senate vote on Tuesday.

The American Bankers Association, Bank Policy Institute, and Independent Community Bankers of America (ICBA) among others, have written to Senate Majority Leader John Thune and Democratic Leader Chuck Schumer, urging changes to the bill's draft.

They argue that the current language leaves open opportunities for crypto companies to pay rewards that function like interest on bank deposits, potentially encouraging customers to move their money away from banks and into stablecoins.

Banks are asking Congress to draw a clearer line between what is allowed in terms of stablecoin rewards, while crypto leaders claim that banks are overstating the threat.