White House adviser: Banks shouldn’t fear stablecoin yield
The banking sector should not view stablecoin-yield offerings from crypto platforms as a competitive threat, and a compromise is achievable, according to White House crypto adviser Patrick Witt.
Witt described it as “unfortunate” that stablecoin yield has become a central dispute between the crypto industry and traditional banks, noting that sharing yield with customers does not undermine banks’ business models or market share.
He told Yahoo Finance: “They can also offer stablecoin products to their customers, just the same as crypto. This is not an unfair advantage in either way, and many banks are now applying for OCC bank charters themselves to start offering bank-like products to their customers.”
“In the future, I don’t think this is going to be an issue,” he added. “I think they’re going to find opportunities to use these products and leverage them and offer new products to their customers and expand their businesses.”
The ability of crypto firms and platforms to pay rewards to stablecoin holders has been a key sticking point in policy discussions, contributing to delays in advancing the CLARITY market structure bill.
Deadline pressure builds for passage of the CLARITY Act, Witt and others say
The proposed CLARITY Act would define regulatory responsibilities for crypto markets between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) and establish a taxonomy for digital assets.
However, government officials and industry executives have cautioned that the approaching 2026 U.S. midterm elections could impede efforts to enact the bill and potentially reverse crypto regulations implemented under the administration of U.S. President Donald Trump.
“I think if the Democrats were to take the House, which is far from my best case, then the prospects of getting a deal done will just fall apart,” U.S. Treasury Secretary Scott Bessent said on Friday.
“There’s a window here. The window is still open, but it is rapidly closing,” Witt said, adding that the White House Crypto Council aims to have the CLARITY Act signed into law before the midterms “take all of the oxygen out of the room.”
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