Crypto firms pitch stablecoin concessions to ease Senate gridlock
Crypto firms are reportedly proposing concessions on stablecoin yields to help advance the stalled U.S. crypto market structure bill in the Senate. The measure passed the House but has been delayed in the Senate amid negotiations over whether stablecoin issuers can offer yield, a point of contention for banks that argue it could divert funds from traditional savings accounts, according to Bloomberg.
Anonymous sources cited by Bloomberg said industry participants have suggested expanding the role of community banks in the stablecoin ecosystem. Ideas under discussion include requiring stablecoin issuers to maintain reserves at community banks and forming partnerships to enable community banks to issue their own stablecoins.
Senator: No risk of deposit flight
A White House meeting on Monday with representatives from the crypto and banking sectors concluded without an agreement. On Wednesday, Senate Banking Committee Chairman Tim Scott told Fox News that while allowing crypto companies to pay rewards is acceptable, they should not market themselves as banks. He added that he does not expect a deposit flight and plans to meet with consumer banks again next week. Scott said both sides remain engaged and he aims to resolve the outstanding issues and bolster the United States’ position in the crypto sector.
Bill requires Senate approval
The US Senate Agriculture Committee released a Republican draft of the market structure bill in January without Democratic support. A markup session on Jan. 29 advanced the bill from the Agriculture Committee, but to pass the full Senate and proceed to President Trump for approval, it will need support from at least seven Democrats.
The Senate Banking Committee’s markup outlines a stricter version of the legislation, and both versions must be reconciled before the bill can move forward.
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