U.S. President Donald Trump has launched a blistering attack on banking industry groups, accusing them of blocking cryptocurrency legislation and labeling their actions 'unacceptable.' He urged banks to 'reach a good deal with the crypto industry,' stressing that the outcome must serve American interests.
Legislative Progress Halted: Coinbase Pulls Support
The House of Representatives passed the CLARITY Act last July, but Senate Banking Committee deliberations hit a snag in January when exchange giant Coinbase abruptly withdrew its support, prompting an indefinite postponement of the review schedule with no restart date in sight. Trump's remarks come amid this intensifying legislative deadlock.
Stablecoin Yields: The Make-or-Break Issue
At the heart of the dispute is the GENIUS Act provision on stablecoin returns. Banking groups strongly oppose allowing third-party platforms to offer interest on stablecoins, arguing it creates a regulatory loophole—if stablecoins start yielding returns, massive deposits could flow from traditional banking systems to crypto platforms, threatening financial stability. For banks, this is existential: stablecoins offering yields directly challenge their core deposit-taking business model.
Crypto industry leaders fiercely resist any blanket ban on stablecoin yields, claiming it would stifle innovation and erode U.S. competitiveness in digital finance. Trump's son Eric Trump took to X to lambast 'big banks' for monopolizing the market, offering near-zero returns on retail money market accounts while exploiting low-balance customers with high fees—and now desperately blocking crypto platforms from providing real benefits and rewards. 'They are the biggest hypocrites, and they're in a collective panic because they know they're losing the digital finance race,' he wrote.
Midterm Clock Ticking: $200 Million in Crypto Donations
Trump's urgency is politically driven. With November's midterm elections approaching, the crypto industry has poured over $200 million into political donations, making it a force both parties cannot ignore. Trump wants to deliver a crypto legislative achievement before the election, fulfilling his promise to make 'America the crypto capital of the world.' Rep. French Hill suggested the Senate adopt the House-passed version, which enjoys bipartisan support, to speed up the process. Whether the Senate agrees remains uncertain.
The tug-of-war essentially pits traditional finance against the emerging crypto sector over who sets the rules for digital finance. Banks fear stablecoin yields could drain $6.6 trillion in deposits, while crypto advocates argue a ban would leave the U.S. trailing in the global stablecoin race. With Trump personally applying pressure and the election clock counting down, the window for compromise is narrowing. Whether the bill breaks through before the vote hinges on banks conceding on the stablecoin yield issue.