President Donald Trump publicly accused major banks of stalling progress on the Senate’s crypto market structure legislation, saying on Truth Social that the GENIUS Act is being ‘‘threatened and undermined by the Banks’’ and urging lawmakers to ‘‘get Market Structure done, ASAP.’’ He warned that banks’ resistance could push a pro-crypto agenda offshore if disputes over the companion CLARITY Act aren’t resolved.
The GENIUS Act, approved by Congress in July, sets a regulatory framework for stablecoin issuers while prohibiting those issuers from directly paying yield to holders. However, third-party platforms — such as crypto exchanges — would still be able to offer yields to users who hold stablecoins, a practice banking groups call a legal loophole. Banks are pressing the Senate to insert a blanket ban on stablecoin yield payments into the market structure bill; the House passed its own version, the CLARITY Act, in July.
Trump urged banks not to ‘‘undercut The Genius Act, or hold The Clarity Act hostage,’’ and asked them to reach a deal with the crypto industry in the public interest. Industry executives and lobbyists have pushed back against a complete yield ban. Coinbase, for example, withdrew its support for the bill in January over the yield issue, and the Senate Banking Committee delayed a planned markup following that withdrawal.
Banking groups argue that allowing stablecoin yields could siphon deposits away from traditional banks and pose risks to financial stability. Administration officials have hosted talks bringing crypto and banking representatives together three times this year, but those meetings have not produced a compromise acceptable to both sides.
Trump is pressing for the legislation to clear Congress as a policy win ahead of the midterm elections, at a time when crypto-aligned political action committees have reportedly raised more than $200 million to back industry-friendly candidates. Representative French Hill, a senior Republican and chair of the House Financial Services Committee, urged the Senate to consider the House-passed CLARITY Act if the Senate bill falters, noting that the House language mirrors the GENIUS Act by treating stablecoins as a payment device on blockchain rather than an investment product and stating they ‘‘would not pay interest, per se.’’
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