A US Senate Democrat says crypto and banking lobbies will both have to accept compromises amid a new proposal to move the crypto market structure bill forward.
Senator Angela Alsobrooks, a key Democrat on the Senate Banking Committee, said at an American Bankers Association event on Tuesday that she and Republican Senator Thom Tillis are working on a compromise proposal, but crypto and banking interests can’t let “perfect be the enemy of good.”
“All of us will probably walk away just a little bit unhappy,” she said. “What we don’t want is to have an unregulated system — to have crypto not regulated at all — and not to have the guardrails to allow a situation where we will have deposit flight.”
Banking groups, including the American Bankers Association, have pushed for the Senate to include a ban on third-party stablecoin yield payments in crypto market structure legislation pending in the Senate.
Senator Angela Alsobrooks speaking on stage at an American Bankers Association conference. Source: American Bankers AssociationThe groups argue that the payments are a deposit flight risk for bank accounts that could destabilize the banking system and that the ban would close a perceived loophole in the GENIUS Act, which banned stablecoin issuers from offering yield on their tokens.
Stablecoin yield payments are a popular way for crypto exchanges to entice customers, and crypto lobby groups have fought against the proposal to ban them.
The fight has stalled the crypto bill from moving forward, which outlines how market regulators would police crypto.
Senator Alsobrooks said that in negotiations for the GENIUS Act, lawmakers knew they’d have to “revisit the issue around interest and yield,” adding that crypto market structure legislation must address the issue of stablecoin yields so they don’t end up undermining the banking sector.
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“If it quacks like a duck and looks like a duck, it is a duck,” she said. “Making sure that we are not allowing bank-like products without bank-like protections — this is what we know is really important.”
Americans want stablecoin yield limits if banks at risk
Alsobrooks’ comments come as the American Bankers Association shared a survey finding that 42% of respondents agreed that Congress should ban stablecoin yields if there is any risk that it could reduce the amount of money available to banks.
The survey, conducted by Morning Consult on behalf of the lobby group and polling a national sample of 4,456 adults, also found that 84% agreed that a business providing bank-like services, like a savings product, should be “held to the same standards for consumer protection that banks are.”
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Source: https://cointelegraph.com/news/crypto-banks-need-to-be-unhappy-crypto-bill-advance-senator?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
