On February 8, crypto journalist Eleanor Terrett disclosed details of next Tuesday's White House crypto meeting. This meeting is the second round in a series and will remain at the staff level, without inviting chief executive officers from various companies; however, senior policy personnel from various banks will attend. According to sources, some large banks, including Bank of America, JPMorgan, and Wells Fargo & Co, have already received invitations, with PNC Bank, Citi, and U.S. Bancorp potentially also on the list. Banking representatives include the Bank Policy Institute, the American Bankers Association, and the Independent Community Bankers of America, although the number of delegates sent by each party is expected to decrease.
The current situation shows that banks aim to restrict cryptocurrency firms from offering interest on stablecoins, believing it threatens their business. They are concerned that substantial inflows into high-yield cryptocurrency accounts could lead to a shortage of funds for bank loans and trigger broader financial instability. On the other hand, cryptocurrency firms argue that this move by banks seeks to undermine market competition, preserve regulatory barriers, and stifle innovation. On Thursday, Treasury Secretary Scott Bessent appeared to acknowledge the legitimacy of the banks' concerns, stating: "I have always been an advocate for these smaller banks, and deposit volatility is highly undesirable. We will continue our efforts to ensure that stablecoin yield payments do not cause deposit volatility."
This meeting relates to the future of the Cryptocurrency Market Structure Act (CLARITY Act). The issue of stablecoin yields has now become a focal point for the White House, even surpassing other contentious topics such as ethics or decentralized finance in importance. Patrick Witt, Executive Director of the White House Cryptocurrency Committee, urged all parties to reach an agreement by the end of this month.
