{"id":17170,"date":"2026-05-12T08:39:29","date_gmt":"2026-05-12T15:39:29","guid":{"rendered":"https:\/\/jasonsblog.ddns.net\/?p=17170"},"modified":"2026-05-12T09:21:15","modified_gmt":"2026-05-12T16:21:15","slug":"american-bankers-attempt-last-ditch-effort-to-kill-crypto-market-structure-bill-regarding-stablecoins","status":"publish","type":"post","link":"https:\/\/jasonsblog.ddns.net\/index.php\/2026\/05\/12\/american-bankers-attempt-last-ditch-effort-to-kill-crypto-market-structure-bill-regarding-stablecoins\/","title":{"rendered":"American Bankers Attempt Last Ditch Effort To Kill Crypto Market Structure Bill Regarding Stablecoins"},"content":{"rendered":"\n

This is just hilarious with the bankers acting a fool over stablecoin returns. Bankers who run fractional reserve banks making a lot of money off your deposits, turn around and pay you diddly, and while the US government insures deposits because banks only hold about 10% reserves. But stablecoins have 100% reserves with US treasuries which pay interest, so stablecoin issuers wanted to pay 4% to holders of stablecoins and why the bankers are worried money will leave their corrupt system slashing their profiting off of other people’s money. Consequently, they had done away with returns for just holding stablecoins, with some incentives I believe for transaction amounts… so a loss for regular citizens saving money. And the bankers really want you to be forced to invest in other products and to pump the stock market having your funds in accounts they manage and collect fees from, leaving you to have your value slashed when their shenanigans crash the markets. But fortunately, we still have the exit from this corrupt system, Bitcoin<\/a>. And also notice which political party is the main enforcers for the bankers, Demonrats.<\/p>\n\n\n\n

https:\/\/www.zerohedge.com\/crypto\/senate-schedules-clarity-act-markup-banking-lobby-democrats-mount-resistance<\/a><\/p>\n\n\n

<\/div><\/div><\/div>\n\n\n

By Tyler Durden<\/p>\n\n\n\n

American Bankers Association (ABA) CEO Rob Nichols sent an emergency Sunday letter<\/a> to every bank CEO in the country, urging \u201cimmediate engagement\u201d against what he called a stablecoin yield loophole in the Digital Asset Market Clarity Act<\/strong>, days before a Senate Banking Committee markup scheduled for Thursday.<\/p>\n\n\n\n

The letter, dated May 11 \u2014 Mother\u2019s Day \u2014 and addressed to ABA member bank CEOs, asked bank leaders to contact their senators and mobilize their employees to do the same before the committee convenes for a scheduled May 14 executive session on the bill.<\/p>\n\n\n\n

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\u201cI am reaching out to make every bank leader in this country aware of an urgent advocacy fight that requires your immediate engagement,\u201d Nichols wrote, according to the letter.<\/em><\/p>\n\n\n\n

He warned that, without further changes, \u201cwe believe the current proposal would unnecessarily incentivize the flight of bank deposits into payment stablecoins, putting both economic growth and financial stability at risk\u201d.<\/em><\/p>\n<\/blockquote>\n\n\n\n

The timing of the letter drew sharp public pushback from Coinbase Chief Legal Officer Paul Grewal, who posted on X that the ABA\u2019s alarm bells were misplaced.<\/strong><\/p>\n\n\n\n

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\u201cMaybe the CEO didn\u2019t get the message from the people actually in the room at the WH in meeting after meeting,\u201d Grewal wrote.<\/em><\/p>\n\n\n\n

\u201cWe\u2019ve already had \u2018immediate engagement.\u2019 You got \u2018idle yield\u2019 killed. I know because I was there \u2014 you weren\u2019t. Take yes for an answer. Move on. Stop wasting the time of the Senate and the American people.\u201d<\/em><\/p>\n<\/blockquote>\n\n\n\n

Sen. Bernie Moreno, a member of the Senate Banking Committee, fired back at the ABA in a social media post<\/a>, saying \u201cthe banking cartel in full panic mode\u201d<\/strong> and accusing it of deceiving lawmakers by characterizing stablecoin yield as a \u201cloophole\u201d – a term he said was an insult to the bipartisan work already done during the GENIUS Act debate. <\/p>\n\n\n\n

\"\"\/<\/figure>\n\n\n\n

As Micah Zimmerman reports for BitcoinMagazine.com,<\/em><\/a> the ABA’s emergency outreach came just hours after<\/em> the Senate Banking Committee has set May 14 as the date for its long-delayed markup of the Digital Asset Market Clarity Act, the most consequential piece of cryptocurrency legislation ever to reach this stage in Congress, as a last-minute lobbying blitz from major banks and a Democratic ethics standoff threaten to derail the bill before it clears committee.<\/strong><\/p>\n\n\n\n

The executive session is scheduled<\/a> for 10:30 a.m. at Room 538 of the Dirksen Senate Office Building in Washington, D.C., where committee members will debate amendments and vote on whether to advance the legislation to the full Senate floor. Committee Chairman Tim Scott (R-SC) confirmed the date last week, and live video feed of the proceedings will be available to the public.<\/p>\n\n\n\n

The CLARITY Act \u2014 formally H.R. 3633, the Digital Asset Market Clarity Act of 2025 \u2014 passed<\/a> the House of Representatives on July 17, 2025, by a 294\u2013134 bipartisan vote, with all 216 Republicans in support and 78 Democrats crossing the aisle. <\/strong>Since then, the bill has stalled in the Senate through two cancelled<\/a> markup sessions, extended negotiations <\/a>over stablecoin regulation, and an intensifying lobbying fight between the crypto industry and the traditional banking sector.<\/p>\n\n\n\n

At its core, the legislation would draw a regulatory boundary between the Securities and Exchange Commission and the Commodity Futures Trading Commission, settling years of jurisdictional litigation over whether digital assets are securities or commodities. <\/p>\n\n\n\n

Under the bill<\/a>, the CFTC would receive exclusive jurisdiction over spot and cash markets for \u201cdigital commodities\u201d \u2014 tokens intrinsically linked to a functioning, decentralized blockchain \u2014 while the SEC retains authority over investment contract assets and primary market fundraising.<\/strong><\/p>\n\n\n\n

Stablecoins are carved out as a separate category under shared oversight.<\/p>\n\n\n\n

Crypto jurisdiction fight reaches the U.S. Senate<\/h2>\n\n\n\n

The Senate version of the bill expanded well beyond the House text, growing<\/a> to nine titles covering decentralized finance protections, illicit finance provisions, bankruptcy safeguards for crypto customers, and the Blockchain Regulatory Certainty Act, which provides safe harbors for software developers.<\/p>\n\n\n\n

The May 14 session marks the Senate\u2019s first formal committee vote on CLARITY after months of procedural slippage. <\/strong>Committee Chairman Scott had originally targeted September 2025 for a Senate floor vote, then moved the goalposts to the end of 2025, and most recently told<\/a> Fox Business he hoped to bring the bill to the Senate floor by June or July 2026.<\/p>\n\n\n\n

The calendar pressure is severe: if the bill does not clear the Senate Banking Committee before the May 21 Memorial Day recess, the entire process resets \u2014 and Senators Cynthia Lummis (R-WY) and Bernie Moreno (R-OH) have both warned<\/a> that failure before Memorial Day could push the next viable legislative window to 2030 or beyond.<\/p>\n\n\n\n

The White House has set July 4 as its target for a presidential signature.<\/p>\n\n\n\n

The banking industry\u2019s failing crypto lobby<\/h2>\n\n\n\n

The banking industry has spent months arguing that even partial stablecoin yield \u2014 particularly when routed through exchanges and third-party platforms rather than issuers directly \u2014 could trigger massive deposit outflows from federally insured banks.<\/p>\n\n\n\n

A joint fact sheet<\/a> released by the ABA, Bank Policy Institute, Consumer Bankers Association, Financial Services Forum, and Independent Community Bankers of America cited a Treasury Department report estimating that stablecoins could lead to as much as $6.6 trillion in deposit outflows if yield is permitted.<\/strong><\/p>\n\n\n\n

That figure faces pushback from within the executive branch. The White House Council of Economic Advisers released<\/a> a report in April finding that prohibiting stablecoin yield \u201cwould do very little to protect bank lending,\u201d estimating that a ban would increase bank lending by only 0.02%. The ABA objected to that report\u2019s findings within days of its release.<\/p>\n\n\n\n

Nichols sent a separate joint letter with 52 state bankers associations to Congress in December urging lawmakers to close the yield loophole, and the ABA joined those same groups in a similar letter to the OCC in April.<\/strong><\/p>\n\n\n\n

The Senate Banking Committee markup on May 14 represents a critical procedural hurdle for the Clarity Act. Even if the bill clears the committee, it still requires 60 votes on the Senate floor, reconciliation with the Senate Agriculture Committee\u2019s version, alignment with the House-passed bill from July 2025, and a presidential signature. <\/p>\n\n\n\n

The White House has set a July 4 target for the bill\u2019s passage.<\/p>\n\n\n\n

Democrats threaten withdrawal of CLARITY Act as heavy-hitters chime in<\/h2>\n\n\n\n

The bill carries heavyweight backing from within the Trump administration. SEC Chair Paul Atkins publicly urged<\/a> Congress on April 9 to move CLARITY to President Trump\u2019s desk, stating that both the SEC and CFTC stand ready to implement the law the moment it is signed. Atkins has cited a project he calls \u201cProject Crypto\u201d as an internal agency readiness effort.<\/p>\n\n\n\n

Treasury Secretary Scott Bessent published<\/a> an op-ed in the Wall Street Journal framing the CLARITY Act as a national security matter, warning that without U.S. regulatory certainty, blockchain developers and crypto companies continue to migrate to Singapore and Abu Dhabi. White House crypto adviser Patrick Witt has described the stablecoin yield compromise as closed.<\/p>\n\n\n\n

Senator Lummis, who chairs the Senate Banking Subcommittee on Digital Assets, posted a single word on X after the Senate returned from Easter recess \u2014 \u201cClarity.\u201d Speaking at the Bitcoin Conference in late April, she was direct: \u201cWe are gonna markup the CLARITY Act in May. We are gonna get it to the finish line. We are gonna have the market structure that allows us to innovate.\u201d<\/p>\n\n\n\n

Meanwhile, Democrats are threatening to withhold<\/a> support unless the bill includes ethics provisions targeting crypto holdings by public officials, a demand Republicans argue could derail the legislation entirely. <\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

This is just hilarious with the bankers acting a fool over stablecoin returns. Bankers who run fractional reserve banks making a lot of money off your deposits, turn around and pay you diddly, and while the US government insures deposits because banks only hold about 10% reserves. But stablecoins have 100% reserves with US treasuries […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6,7],"tags":[],"class_list":["post-17170","post","type-post","status-publish","format-standard","hentry","category-tech","category-world"],"blocksy_meta":[],"featured_image_src":null,"author_info":{"display_name":"Jason","author_link":"https:\/\/jasonsblog.ddns.net\/index.php\/author\/jturning\/"},"_links":{"self":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts\/17170","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/comments?post=17170"}],"version-history":[{"count":4,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts\/17170\/revisions"}],"predecessor-version":[{"id":17183,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts\/17170\/revisions\/17183"}],"wp:attachment":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/media?parent=17170"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/categories?post=17170"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/tags?post=17170"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}