{"id":76074,"date":"2026-07-29T00:11:37","date_gmt":"2026-07-29T00:11:37","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/134-bank-leaders-sound-alarm-over-clarity-act-they-want-a-key-crypto-rule-changed\/"},"modified":"2026-07-29T00:11:37","modified_gmt":"2026-07-29T00:11:37","slug":"134-bank-leaders-sound-alarm-over-clarity-act-they-want-a-key-crypto-rule-changed","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/134-bank-leaders-sound-alarm-over-clarity-act-they-want-a-key-crypto-rule-changed\/","title":{"rendered":"134 Bank Leaders Sound Alarm Over CLARITY Act \u2014 They Want a Key Crypto Rule Changed"},"content":{"rendered":"<p><b>(Originally posted on : Bitcoin News )<\/b><br \/>\n<\/p>\n<div>\n<div class=\"@container mb-[25px] rounded-sm overflow-clip py-0.5 pr-0.5 pl-2.5 bg-success-100\">\n<div class=\"flex flex-col gap-m overflow-clip rounded-[6px] !bg-success-10 p-3 @[420px]:p-m\">\n<h2 class=\"m-0 flex items-center gap-s text-[19px] !text-[#1c1c1c] md:text-[20px]\"><svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"16\" height=\"10\" viewbox=\"0 0 16 10\" fill=\"none\" class=\"shrink-0 text-success-100\" aria-hidden=\"true\"><path d=\"M1 1.5h14\" stroke=\"currentColor\" stroke-width=\"2.5\" stroke-linecap=\"round\"\/><path d=\"M1 8.5h10\" stroke=\"currentColor\" stroke-width=\"2.5\" stroke-linecap=\"round\"\/><\/svg><span>Key Takeaways<\/span><\/h2>\n<ul class=\"m-0 flex list-none flex-col gap-m pl-0\">\n<li class=\"m-0 flex items-start gap-s !text-[#434248]\"><span class=\"mt-2 size-2 shrink-0 rounded-full bg-success-100\" aria-hidden=\"true\"\/><span class=\"text-body\">134 bank leaders urged Senate lawmakers to strengthen stablecoin interest and yield restrictions in the CLARITY Act.<\/span><\/li>\n<li class=\"m-0 flex items-start gap-s !text-[#434248]\"><span class=\"mt-2 size-2 shrink-0 rounded-full bg-success-100\" aria-hidden=\"true\"\/><span class=\"text-body\">Bankers warned incentives tied to stablecoin holdings could weaken the deposit base supporting local lending.<\/span><\/li>\n<li class=\"m-0 flex items-start gap-s !text-[#434248]\"><span class=\"mt-2 size-2 shrink-0 rounded-full bg-success-100\" aria-hidden=\"true\"\/><span class=\"text-body\">The dispute centers on whether payment stablecoins should function only as transaction tools.<\/span><\/li>\n<\/ul>\n<\/div>\n<\/div>\n<h2>Bank Leaders Push Senate to Rewrite Stablecoin Provision<\/h2>\n<p>The <a href=\"https:\/\/www.aba.com\/-\/media\/documents\/letters-to-congress-and-regulators\/ltrclarityact20260728.pdf?rev=aba88cbbf3eb4e168d99504992a07e9a\" target=\"_blank\" rel=\"noopener noreferrer\">bank leaders\u2019 CLARITY Act <\/a><span style=\"box-sizing:border-box;margin:0px;padding:0px\"><a href=\"https:\/\/www.aba.com\/-\/media\/documents\/letters-to-congress-and-regulators\/ltrclarityact20260728.pdf?rev=aba88cbbf3eb4e168d99504992a07e9a\" target=\"_blank\" rel=\"noopener noreferrer\">letter <\/a>urged<\/span> U.S. Senator John Thune (R-SD), Majority Leader of the U.S. Senate, and U.S. Senator Charles Schumer (D-NY), Minority Leader of the U.S. Senate, to revise Section 10404 of the CLARITY Act.<\/p>\n<p>Section 10404 of the crypto legislation establishes restrictions on paying interest or yield on payment stablecoins. The banking executives want lawmakers to strengthen the provision so companies cannot bypass the prohibition through rewards, incentives, or other arrangements that create similar economic benefits for holding stablecoins.<\/p>\n<p>The bank leaders stated:<\/p>\n<blockquote>\n<p>\u201cWe therefore urge the Senate to incorporate the targeted Section 10404 changes recommended by our state bankers associations before final passage.\u201d<\/p>\n<\/blockquote>\n<p>\u201cIf stablecoin products are permitted to attract and retain balances through interest-like rewards or other holding-based incentives, the local funding base that supports this lending could be weakened by hundreds of billions,\u201d the group warned.<\/p>\n<p>The letter argues that deposits provide the foundation for lending to families, small businesses, farmers, and local employers. The signatories said clear rules would allow payment stablecoins to develop while preserving <a href=\"https:\/\/bankingjournal.aba.com\/2026\/07\/bankers-local-lending-at-risk-if-stablecoin-payment-of-interest-loophole-isnt-closed\/\" target=\"_blank\" rel=\"noopener noreferrer\">the funding channels that support community lending<\/a>.<\/p>\n<h2>Stablecoin Rewards Become Central Issue in Crypto Legislation<\/h2>\n<p>The debate highlights a broader disagreement over the future role of stablecoins in financial markets. Bankers argue payment stablecoins should remain focused on transactions rather than become products designed to attract long-term holdings.<\/p>\n<p>The banking industry has previously <a href=\"https:\/\/news.bitcoin.com\/banks-reject-stablecoin-yield-compromise-demanding-stricter-crypto-limits\/\">raised stablecoin yield concerns<\/a> as digital asset companies and policymakers examine how rewards, incentives, and reserve structures could affect competition with traditional financial institutions.<\/p>\n<p>The signatories argued that incentives tied to balances, holding periods, or account duration could replicate features of interest-bearing products, creating the need for clearer boundaries in the CLARITY Act.<\/p>\n<p>The issue has also emerged in discussions surrounding the bill\u2019s treatment of stablecoin incentives, with the <a href=\"https:\/\/news.bitcoin.com\/stablecoin-rewards-hit-a-wall-in-senates-clarity-act-draft-leaving-industry-guessing\/\">CLARITY Act stablecoin rewards debate<\/a> highlighting disagreements over how regulators should define prohibited yield arrangements.<\/p>\n<h2>Banks Warn Stablecoin Growth Could Change Lending Landscape<\/h2>\n<p>Bank leaders say deposits remain a major source of funding for mortgages, business expansion, agricultural operations, and community investment. They argue that stablecoin products designed around holding incentives could alter those funding flows.<\/p>\n<p>The debate follows broader industry <a href=\"https:\/\/news.bitcoin.com\/stablecoins-could-drain-trillions-from-bank-deposits-bank-of-america-flags-6t-risk-that-could-redefine-lending\/\">concerns about stablecoin deposit risks<\/a> as financial institutions evaluate how digital assets may compete with traditional banking products.<\/p>\n<p>The proposed CLARITY Act revisions would preserve stablecoin payment innovation while limiting structures that bankers believe could replicate deposit-like incentives without the same regulatory framework applied to insured banks.<\/p>\n<p>The Senate\u2019s final language on stablecoins will define how payment-focused digital assets operate within the broader U.S. financial system.<\/p>\n<\/p><\/div>\n<p><a href=\"https:\/\/news.bitcoin.com\/regulation-and-legal\/134-bank-leaders-sound-alarm-over-clarity-act-they-want-a-key-crypto-rule-changed\/\">Source link <\/a><br \/>\n<br \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>(Originally posted on : Bitcoin News ) Key Takeaways 134 bank leaders urged Senate lawmakers to strengthen stablecoin interest and yield restrictions in the CLARITY Act. Bankers warned incentives tied to stablecoin holdings could weaken the deposit base supporting local lending. The dispute centers on whether payment stablecoins should function only as transaction tools. Bank [&hellip;]<\/p>\n","protected":false},"author":11,"featured_media":76075,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[32],"tags":[],"_links":{"self":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/76074"}],"collection":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/comments?post=76074"}],"version-history":[{"count":0,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/76074\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media\/76075"}],"wp:attachment":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media?parent=76074"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/categories?post=76074"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/tags?post=76074"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}