Crypto Advocates Renew Stablecoin Rewards Push as Market Structure Bill Nears Key Senate Vote
A Senate Banking Committee vote on a major crypto market structure bill has renewed debate over stablecoin rewards. Community bank leaders urged senators to ban stablecoin rewards, arguing they threaten local lending by encouraging deposit flight from banks. Crypto industry leaders, including Coinbase and The Digital Chamber, countered that banning rewards would harm U.S. innovation and cede ground to global competitors like China. Under current regulations, platforms such as Coinbase can pay users yield-like rewards on stablecoin holdings, a practice traditional banks argue is unfair and potentially destabilizing. Lawmakers are reportedly seeking “parity” between banks and crypto firms in any final legislation. The bill is set to clarify regulatory jurisdiction between the SEC and CFTC and mandate registration rules for exchanges. Crypto advocates are actively lobbying in Washington, emphasizing that stablecoin rewards are critical for consumer adoption, U.S. digital dollar leadership, and industry competitiveness. The scope of the final bill, including stablecoin provisions, is still being finalized, with both sides viewing the issue as pivotal to the bill’s passage.
