The crypto industry is mounted on a counteroffensive against the bid of bankers on Wall Street at Rewrite US ‘new stablecoin law. (Genius) The ACT will tilt the field to traditional banks.
In a letter to the leaders of the Senate Banking Committee dated on August 19, the Crypto Council for Innovation and Blockchain Association urged lawmakers to reject proposals from the American Bankers Association, Bank Policy Institute and State Banking Groups to call for the removal of section 16(d) of the law and prohibition of yield programs offered by the affiliates of Stablecoin’s readers.
Section 16(d) The subsidiaries of state-charter institutions are allowed to conduct money delivery throughout the state lines in support of stablecoin-provided activities, ensuring that holders can redeem their tokens across the country without the need for separate state licenses.
Banking groups have warned earlier this month that allowing states that have been charged, uncertain institutions to issue stablecoins and operate the whole country will be worth the regulatory arbitration, which exceeds state licensing regimes, CoinDesk reported earlier.
They also argued that the law contained a loophole by prohibiting those who gave themselves from interest but did not prevent affiliates or exchanges from doing so, saying that $ 6.6 trillion could be depleted of deposits from the US banking system.
The Crypto Groups ‘Letter’ August 19 removed fears that were not supported by the observed data. A study was mentioned in July 2025 by Charles River Associates, groups said there was no significant link between Stablecoin Adoption and Community Bank Deposit Outflows.
Instead, they taught, most stablecoin reserves remain within the financial system with commercial banks and security security, which continues to support lending.
They also argue that allowing affiliates to share rewards with Stablecoin users ensures fair competition, especially for underbanked consumers who are ignored by traditional banks.
At present, The average US checking account pays only 0.07% APYFar below inflation, as the interest rate of the benchmark of the Federal Reserve stands at 4.25%-4.50%.
“Removal of these features for Stablecoin users, while allowing them to the banking sector, will tilt the playing field in favor of legacy institutions,” the group’s letter wrote.
The Genius Act is law, but the Digital Asset Market Clarity Act, a wider framework of crypto markets passed by the Chamber and is currently in the Senate, can still reinstate the Stablecoin policy before the draft regulators implementing the policies.
The bankers seized that process to push their agenda, while crypto groups launched to keep the law intact.
Republican Tim Scott of South Carolina, the Chairman of Senate Banking. However, he recognized the possibility of resistance from Sen. Elizabeth Warren, a Democrat from Massachusetts, and his allies.
Any version that appears will need to negotiate with the home’s Digital Asset Market Clarity Act and may provide opening of bankers who want to change Stablecoin’s provisions before starting the writing rules.
