U.S. banks are growing more divided as the Senate moves toward marking up the CLARITY Act next week, with stablecoin yield rules emerging as the main fault line. Large retail-focused banks say the latest compromise still leaves room for crypto firms to launch yield-like stablecoin products, while institutions with less exposure to consumer deposits are showing more support for moving the bill ahead.
According to Crypto In America, the revised text released by Senators Thom Tillis and Angela Alsobrooks has not resolved concerns among major consumer banks after months of negotiations. The Bank Policy Institute, the American Bankers Association, and the Independent Community Bankers of America all criticized the updated stablecoin provisions. Their concern is that, even with language banning products that are “economically or functionally equivalent” to bank accounts, the wording remains too narrow.
Retail banks warn crypto firms could mimic deposit products
Sources from large consumer banks told Crypto In America that companies such as Coinbase and Stripe could still structure offerings that resemble interest-bearing accounts. Banking groups are now planning more outreach to members of the Senate Banking Committee before the markup begins. One banking source said the proposal does not fully shut down stablecoin yield structures.
For retail banks, the issue goes beyond competitive pressure. If stablecoins can be packaged in ways that look and feel like savings products, they could edge into a business area long dominated by the banking system. That helps explain why resistance has been strongest among institutions with large retail deposit franchises.
Investment banks back clearer rules for crypto activity
By contrast, several firms without major retail deposit businesses appear more open to the current compromise. The report said Goldman Sachs, BNY, and Morgan Stanley support advancing the legislation. These institutions are focused more on getting clearer treatment for crypto-related banking activity than on the threat of stablecoins drawing away household deposits.
As described in the proposal, the CLARITY Act would set out clearer regulatory treatment for activities including trading, staking, lending, and future infrastructure linked to portfolio margining. It would also limit future regulators from restricting activities considered financial in nature under the Bank Holding Company Act.
Supporters see that structure as a way to widen institutional access to digital asset markets. The report places that market near $3 trillion.
Community banks remain divided as negotiations appear finished
Smaller community banks have not lined up on one side. The Independent Community Bankers of America has publicly opposed the latest compromise, arguing that stablecoins could affect deposits and lending. At the same time, Crypto In America reported that some regional lenders privately backed the proposal. One community bank called it a “fair compromise” and said the framework leans more toward payments than savings products.
On the legislative side, negotiations appear close to done. Senator Cynthia Lummis said Monday that the text had been finalized. As the Senate markup approaches, the split inside the banking sector is set to shape the next stage of debate over stablecoin yield, crypto banking activity, and the limits of future regulatory authority.