White House Urges Banks to Permit Stablecoin Rewards

The debate over U.S. crypto regulation has entered a new phase as negotiations around the Clarity Act intensify. This time, the White House has stepped in directly. Officials are urging banks to allow limited stablecoin rewards in order to break a key deadlock. As a result, momentum around the bill has picked up again. Lawmakers now face pressure to reach an agreement before the proposed March 1, 2026 deadline.

White House Pushes Compromise on Stablecoin Rewards

The White House believes a controlled stablecoin rewards system could unlock progress. Specifically, officials want banks to permit limited incentives tied to regulated stablecoins. In return, lawmakers may gain enough bipartisan support to move the Clarity Act forward.

At its core, the Clarity Act aims to divide digital asset oversight between the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission. Currently, regulatory uncertainty has slowed innovation and discouraged institutional participation. Therefore, supporters argue that clearer rules would strengthen market confidence.

Why Banks Remain Cautious

However, banks have not fully embraced the proposal. Many financial institutions worry that stablecoin rewards could draw deposits away from traditional savings accounts. If customers move funds into digital wallets, banks could face liquidity pressure.

Moreover, banking groups argue that even limited yields might create long-term competition with conventional products. As a result, negotiations have stalled at several points. Nevertheless, policymakers continue to search for safeguards that would cap rewards and limit systemic risk.

Industry advocates, on the other hand, insist that carefully designed programs would not destabilize the system. Instead, they argue these incentives could modernize financial services and attract younger users.

White House Sees Strategic Value in Crypto Integration

Importantly, the White House views this compromise as more than a minor adjustment. Officials see it as a strategic step toward integrating digital assets into the traditional banking system. By encouraging limited rewards, the White House hopes to bridge the gap between innovation and regulation.

In addition, advisers believe successful passage of the Clarity Act could unlock significant capital flows into blockchain markets. Clearer oversight would reduce compliance risks and attract institutional investors.

What Comes Next for the Clarity Act

For now, talks continue behind closed doors. While disagreements remain, both lawmakers and industry leaders recognize the urgency. If the White House secures enough support, the Clarity Act could reshape how the United States regulates crypto.

Ultimately, the outcome will determine whether America leads in digital asset innovation or falls behind global competitors.

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