In a recent meeting at the White House, discussions between bankers and crypto industry representatives focused on stablecoin rewards, a key element of the upcoming crypto market structure bill. The meeting aimed to bridge gaps and secure support for the legislation, which is crucial for regulating U.S. crypto markets.
According to sources familiar with the negotiations, the White House is advocating for limited stablecoin rewards to be included in the next draft of the bill. If bankers agree, these provisions could significantly influence the legislation’s advancement. The ongoing discussions are part of the U.S. Senate’s Digital Asset Market Clarity Act, which represents the crypto industry’s primary policy goal in Washington.
This gathering marked the third time the White House has brought together financial institutions and crypto insiders to find common ground. During the session, White House negotiators emphasized the necessity of allowing certain rewards for specific activities and transactions, while excluding rewards for stablecoin holdings that resemble traditional deposit accounts. Patrick Witt, an advisor to President Donald Trump on crypto matters, led the discussions, urging a swift resolution to facilitate the bill’s progress.
Bankers have expressed concerns that permitting stablecoin rewards could disrupt their traditional business models, which rely on interest-bearing deposits. Despite these challenges, participants left the meeting with a sense of optimism that a compromise might be within reach. Blockchain Association CEO Summer Mersinger remarked that the meeting was a positive step toward resolving outstanding issues related to rewards.
If banks ultimately reject the proposed limited rewards, the existing GENIUS Act would remain in effect, allowing crypto platforms greater flexibility with rewards programs. Conversely, if banks endorse the new approach, their support could sway hesitant senators back toward the legislation.
However, the stablecoin rewards issue is just one of several contentious points within the Clarity Act that require negotiation. The crypto sector is also responding to Democratic lawmakers’ demands for enhanced protections against fraudulent activities, particularly in the decentralized finance (DeFi) arena.
Additionally, Democratic negotiators have raised concerns about potential conflicts of interest, calling for a ban on senior government officials engaging directly with the crypto industry. They have also requested the White House to appoint individuals to fill Democratic vacancies at the Commodity Futures Trading Commission and the Securities and Exchange Commission.
As the Senate Banking Committee prepares to advance the bill, the outcome may hinge on whether these contentious issues can be resolved. While the legislation may progress through subsequent stages, gaining bipartisan support will be critical for its success in the Senate.
The White House is advocating for limited stablecoin rewards in ongoing negotiations with bankers, aiming to advance the crucial crypto market structure bill. While progress has been made, significant issues remain unresolved, particularly concerning protections against fraud and potential conflicts of interest.