Banks vs. Crypto: The Fight Over Stablecoin Rewards

Big banks are pushing for changes to the GENIUS Act. They want to stop stablecoin issuers from offering rewards through third parties. Crypto leaders say this is just a way for banks to keep out competition. The GENIUS Act already stops stablecoin issuers from giving interest. But major crypto exchanges still reward holders. Community banks say this is a loophole. They argue it hurts their ability to lend. Crypto groups disagree. They say there's no proof stablecoins hurt banks. They also say bank accounts with low interest rates help big banks more than regular people. Stablecoin rewards, on the other hand, benefit everyday users.John Deaton, a pro-crypto lawyer, warns that changing the law could be dangerous. He says it might push people to use China's digital yuan. China already offers interest on its digital currency. This makes it a strong competitor to the US dollar. Alexander Grieve from Paradigm agrees. He says undoing the rewards part of the law would undo progress. Mike Novogratz, CEO of Galaxy Digital, is frustrated too. He says the US would be foolish to reverse the law. He tells banks to toughen up and compete.