134 U.S. bank executives urge the Senate to amend the CLARITY Act's stablecoin provisions

According to Odaily, 134 U.S. banking association officials and senior bank executives are urging the Senate to amend Section 10404 of the CLARITY Act before its final passage to strengthen restrictions on interest and returns paid on payment stablecoins.

The banking representatives hope lawmakers will broaden the scope of restrictions to prevent companies from offering equivalent economic benefits for holding stablecoins through rewards, incentives, or other arrangements. They stated that if stablecoins can attract and retain balances through interest-like incentives, the funding base supporting local lending could be reduced by hundreds of billions of dollars.

The letter argues that deposits form the basis for loans to households, small businesses, farmers, and local employers. The signatories believe that clear rules will allow the development of payment stablecoins while preserving channels for financing community lending.