Archive · 15 Jan 2026
Banks and Crypto Clash Over Stablecoin Rewards
Banks and crypto companies are arguing about stablecoins, which are digital tokens tied to the U.S. dollar.
Crypto firms offer rewards to people who hold these tokens, similar to interest on bank deposits.
Banks say this is unfair because they have to follow strict rules, while crypto companies argue that banks are just trying to protect their business.
This fight might delay a new law that would regulate crypto.
Some big banks are also planning their own crypto products.
The U.S. government is worried that stablecoins could take a lot of money away from banks.
Both sides are trying to convince lawmakers to support their views.
Cryptocurrency and banking industries are in a lobbying battle over stablecoin rewards.
Banks argue that stablecoin rewards resemble high-yielding deposits without the same regulations.
The fight threatens to delay a Senate Banking Committee vote on crypto market-structure legislation.
Crypto firms accuse banks of using community banks as a front for their lobbying efforts.
The Treasury Department estimates stablecoins could drain up to $6.6 trillion from U.S. banks.
- Who
- Cryptocurrency firms (e.g., Coinbase) and banking industry groups (e.g., American Bankers Association).
- What
- A lobbying battle over stablecoin rewards that yield annual payouts.
- When
- Ongoing, with a potential Senate Banking Committee vote on Thursday.
- Where
- Washington, D.C.
- Why
- To regulate stablecoin rewards and integrate crypto into mainstream finance.
- Stablecoins
- Tokens pegged to the U.S. dollar used for trading, payments, and transfers.
- Rewards
- Annual payments to investors based on a percentage of their total holdings.
- National Average Interest Rate
- Below 0.1% for standard interest-bearing checking accounts.
- Treasury Department Estimate
- Stablecoins might drain up to $6.6 trillion in deposits from U.S. banks.
- Total U.S. Bank Deposits
- $18.7 trillion as of early January, per Federal Reserve data.
- Deposit Insurance
- U.S. government insures deposits up to $250,000.
- Coinbase Reward
- 3.5% reward for consumers in its Premium program holding Circle stablecoins.