The stablecoin yield clash that won’t go away has banks, crypto battling over tradition
The bankers want people kept in lower-yield deposits for the good of the financial system as it’s existed for generations, and their argument is gaining ground.
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Summary
- The crypto industry thought it left the debate settled over whether it would be allowed to offer rewards to people using stablecoins, but banking lobbyists came back to undermine an earlier compromise effort, leaving the Clarity Act on shaky ground.
- The question at the heart of the banks’ argument, that depositors will run to stablecoins if they compete with banks’ deposit-account interest, has some glaring weaknesses, according to crypto lobbyists.
- A CoinDesk analysis shows the banks are giving far less in interest than they once did, aren’t yet losing depositors and the lending they tout is an increasingly smaller part of their very profitable business model.
