The concept of using stablecoins in the financial system

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Banks and crypto firms are fighting over the same line of legislative text, and the outcome could reshape how stablecoins compete with traditional bank deposits.

Senators Thom Tillis and Angela Alsobrooks this week released proposed language as part of ongoing CLARITY Act negotiations that would draw a boundary around stablecoin yield, prohibiting rewards paid in a way that is economically or functionally equivalent to interest on a bank deposit. At the same time, the comment period closed on the Office of the Comptroller of the Currency’s proposed rulemaking on stablecoin issuance, and the yield question dominated the feedback. Banks said the proposal doesn’t go far…