Banks stall key US crypto market bill

TLDR

US banks are pushing back against a major US crypto market structure bill, creating a fresh stalemate in Congress around stablecoin yields and deposit flight risk.

1. The CLARITY Act, a landmark US crypto market structure bill, is stalled after major banks rejected a White House compromise on stablecoin yield rules.
2. Banks argue yield-bearing stablecoins could pull up to hundreds of billions of dollars from bank deposits, while crypto firms say a broad yield ban would be anti-competitive.
3. The next inflection points are Senate Banking Committee markup timing, any revised compromise on yields, and how the US election calendar reshapes the odds of passage.

Deep Dive

1. What Is Stalled And Why

The main bill in question is the Digital Asset Market Structure Clarity Act (the CLARITY Act), a broad framework for how US regulators treat crypto trading, custody, and tokens. It passed the House in 2025 and is now stuck in the Senate.

According to multiple reports, major banks rejected a White House compromise that would have allowed limited stablecoin rewards only for peer to peer payments while banning yield on idle balances, creating a new stalemate and casting doubt on passage in 2026. Banks resistance has already led the Senate Banking Committee to postpone its planned markup of the bill indefinitely, with President Trump publicly accusing banks of holding the legislation hostage and undermining the earlier GENIUS Act stablecoin law.

2. Why Banks Are Fighting Stablecoin Yields

The core fight is over whether stablecoins and platforms built on them can pay yield or rewards to users. Banks warn that if stablecoins can offer 4 to 5 percent type returns while typical US savings accounts sit near zero, deposits could migrate out of banks. Some analyses cited in recent coverage estimate stablecoins could eventually divert up to roughly 500 billion dollars from the banking system, which banks frame as a credit and financial stability risk.

Crypto firms and pro-crypto policymakers counter that banning most forms of yield would be anti-competitive and would lock in banks low rate advantage, arguing that GENIUS already restricts issuers and that further bans mainly protect incumbents rather than consumers.

3. What To Watch Next For Crypto Markets

Despite the current impasse, some industry sources still see a path to rescheduling a Senate Banking markup if a narrower compromise on stablecoin rewards can be drafted that both banks and crypto firms can live with. Senators involved in the negotiations are reportedly revising language to the bare minimum acceptable to both sides to get the bill moving again.

Time is the other big constraint. The legislative calendar is tightening ahead of US elections, and analysts note that if the bill is not advanced by mid year, the odds of passage drop sharply, especially if the balance of power shifts. In parallel, the executive branch and regulators are inching forward with narrower guidance and charters, but that is not a full substitute for a comprehensive market structure law.

Conclusion

Banks lobbying against stablecoin yields has turned a technical market structure bill into a direct fight over deposits and credit, stalling the CLARITY Act in the Senate. Until there is a workable compromise on how much yield stablecoin ecosystems can offer, US crypto markets will continue to operate under a patchwork of rules rather than a unified framework, and the window for fixing that in the current Congress is narrowing.