U.S. Market Structure Reform Pulls Crypto Into Banking

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Overview

David Sacks, the White House crypto and AI advisor, stated in a CNBC interview that pending market structure legislation will pull banks directly into crypto markets. His comments explained why lawmakers now aim to absorb digital assets into banking, rather than regulate crypto as a separate industry.

From Similar Systems to One Regulated Industry

Sacks said market structure legislation will erase the line between traditional banking and crypto markets. According to him, Congress now views digital assets as part of the financial system. Notably, he said banks will fully enter crypto after lawmakers pass the bill.

That shift shows how regulation has changed direction. Previously, agencies tried to contain crypto risks outside banking. However, lawmakers now focus on defining how crypto fits within existing oversight frameworks. Sacks said the result will be one regulated digital assets industry.

He explained that banks already wait for legal clarity, not technical readiness. Once rules exist, banks can issue stablecoins and offer crypto services. As a result, market structure legislation becomes the trigger for institutional entry.

Sacks added that the GENIUS Act showed this pattern. Passed in July 2025, the law set rules for stablecoins. Institutional participation increased afterward, according to administration officials. That experience shaped the current market structure effort.

Importantly, Sacks framed regulation as structural alignment, not restriction. He said policymakers no longer treat crypto as an external threat. Instead, they want consistent oversight across similar financial products. That principle now guides negotiations in Congress.

Stablecoin Yield and the Banking Dispute

However, stablecoin yield is the main reason for the dispute delaying the bill. Crypto firms want permission to offer yield or rewards. Banks oppose that provision, citing competitive and regulatory concerns. According to Sacks, both sides must compromise.

He said stablecoin yield already exists under current law. Therefore, banks risk losing leverage if talks collapse. “If there’s no deal, then they’re going to lose on this issue,” Sacks said. That warning aimed to reset negotiations.

Banks have responded with lobbying pressure. The American Bankers Association spent over $2 million in 2025, including efforts tied to the CLARITY Act. Notably, banks seek language limiting crypto firms from replicating deposit-like products.

Meanwhile, crypto firms argue yield matters for competition. However, Sacks urged them to focus on the larger objective. He said securing market structure legislation outweighs any single provision. Without it, regulatory uncertainty continues.

Sacks compared the standoff to the GENIUS Act’s history. That bill failed multiple times before passage. He said compromise often leaves all sides dissatisfied. Nevertheless, he argued that outcome enables long-term regulatory stability.

Harmonizing Oversight Across Financial Products

Regulatory parity now anchors the bill’s design. Sacks said identical products should face identical rules. That principle addresses banks’ concerns about uneven oversight. At the same time, it acknowledges crypto’s integration into finance.

He said banks will eventually accept stablecoin yield once they issue stablecoins themselves. Over time, he expects their position to change. According to Sacks, banks will view yield as a competitive tool, not a threat.

This framing explains the administration’s strategy. Market structure reform does not elevate crypto above banking rules. Instead, it pulls crypto into them. Lawmakers now debate how federal regulators divide oversight between the SEC and CFTC.

That debate continues as a major crypto platform withdrew support for the CLARITY Act. The decision showed the tensions within the crypto sector. However, Sacks said abandoning the bill risks harsher outcomes later.

Throughout the interview, he stressed timing. Congress must pass the legislation to unlock institutional participation. The administration’s position is consistent. It wants a unified regulatory framework covering banks, fintech firms and crypto companies. According to Sacks, that framework defines crypto as finance infrastructure, not an alternative system.

David Sacks’ remarks clarified how U.S. market structure reform reframes crypto as banking infrastructure. His comments outlined why lawmakers now seek integration, regulatory parity, and institutional participation. Together, stablecoin rules, oversight harmonization and compromise define this legislative push.