The post Banks Reportedly Lobby to Revise GENIUS Act Stablecoin Interest Provisions appeared on BitcoinEthereumNews.com.

Banks are lobbying to amend the GENIUS Act, seeking to reverse a settled compromise on stablecoin interest payments due to claimed safety concerns. Critics, including Coinbase CEO Brian Armstrong, argue this protects banks’ profit margins from competition, as banks earn high interest on deposits while paying customers minimal rates. Banks claim lobbying protects community bank deposits amid stablecoin growth. The GENIUS Act prohibits direct interest from issuers but allows third-party rewards. Independent analysis shows no unusual deposit losses; banks earn over 4% on reserves versus 0.01% to savers. Discover why banks lobby to change the GENIUS Act on stablecoin interest. Uncover the controversy, Coinbase’s red line stance, and implications for crypto regulation. Stay informed—explore key details now! What is the GENIUS Act and why are banks lobbying to change it? The GENIUS Act establishes a regulatory framework for stablecoins in the United States, resulting from months of negotiations between banks and issuers. It prohibits stablecoin issuers from paying interest directly to holders but permits platforms and third parties to offer rewards. Banks now seek to reopen this compromise, citing safety and deposit concerns. Why are banks pushing to reverse the GENIUS Act interest compromise? Banks assert their efforts stem from safety issues and risks to community bank deposits. However, crypto advocate Max Avery notes independent research reveals no evidence of unusual deposit outflows from community banks. Traditional banks profit significantly by earning over 4% interest on customer deposits at the Federal Reserve, while paying savers around 0.01% on savings accounts. Avery warns that broadening amendments to ban “rewards” could eliminate third-party yield sharing, stifling competition. He questions lawmakers’ silence on stagnant bank savings rates despite Federal Reserve policy shifts over 15 years, as stated in his public commentary on X. Frequently Asked Questions What does the GENIUS Act say about…

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Filed under: News - @ December 28, 2025 1:44 am