The U.S. banking sector is advocating for a comprehensive ban on interest payments for stablecoins, as the Senate prepares to review the "Crypto Market Structure Act" on January 15. The American Bankers Association (ABA) has called for the extension of the GENIUS Act's prohibition on interest payments from issuers to include distributors, citing concerns over potential bank deposit outflows and the lack of Federal Deposit Insurance Corporation (FDIC) insurance for stablecoins.
Coinbase, which currently offers a 3.35% reward for holding USDC, opposes this move, arguing that stablecoins have not significantly impacted bank deposits. The crypto industry fears that expanding the GENIUS Act's restrictions could hinder its growth. Meanwhile, countries like China and South Korea are taking varied approaches to stablecoin regulation, with China offering interest on digital yuan payments to promote adoption, while South Korea aligns more closely with U.S. policies.
U.S. Banking Sector Pushes for Ban on Stablecoin Interest Payments
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