The American Lawyers Association criticizes the White House study on the Transparency Act

In a statement, the banking group clarified that the White House study conducted by the Council of Economic Advisers on stablecoin yields focused on the wrong question for policymakers—namely, the fate of bank lending if stablecoin rewards are banned. The group noted that the real policy concern lies in whether allowing yields on stablecoin payments will encourage deposit withdrawals, especially from local banks.

As CoinGape reported last week, the White House study on stablecoin yields indicated that a ban on these yields would only contribute slightly to boosting bank lending. The study also addressed the risks of deposit flight, stating that concerns about it are “quantitatively minor.”

The American Bankers Association believes that these White House economists focused on the wrong question. The statement said: “By focusing on the effects of the ban, the Council of Economic Advisers paper risks creating a misleading sense of security by ignoring the most important scenario: the rapid expansion of payment stablecoins that generate yields.”

The banking group acknowledged that the Council of Economic Advisers may have chosen its framework for analytical purposes. However, they pointed out that the economists may have drafted the study in a way that favors the cryptocurrency sector, given the disagreements between banks and stakeholders in this sector regarding the text of stablecoin yields in the Transparency Act.

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