The battle is likely to be finished one way or another next month, when the Clarity Act gets its final three weeks of Senate action before the midterm elections, and the stakes will test the old-guard strength of bank lobbyists against the high-spending political powers of crypto advocates.

The banks have made an appeal that what they’re doing represents the public good: Their business model requires that people keep their money in deposits, which don’t pay enough interest to compete with what crypto firms would pay in stablecoin yield, if given the chance. People can’t be allowed to make money off their holdings of stablecoins, the banks contend, because if customers abandon low-interest bank deposits, the institutions won’t be able to…