#WhiteHouseTalksStablecoinYields

#WhiteHouseTalksStablecoinYields
Closed-door meetings held in Washington this week have focused on the legality of the "yield" concept within the crypto asset ecosystem. Hosted by the White House Advisory Council on Digital Assets, these sessions tackled "stablecoin rewards"—the primary hurdle facing major anticipated regulations like the GENIUS Act and the CLARITY Act.
At the core of the crisis lies a deep divergence between the traditional banking sector and crypto platforms. Banks argue that interest-like yields offered on stablecoins will lead to "deposit flight" and undermine financial stability. Conversely, tech giants emphasize that these yields are the lifeblood of innovation and liquidity.
Seeking Consensus and the "Transaction-Oriented Yield" Formula
To break the deadlock between the parties, White House officials have proposed a new "middle ground" framework. According to this draft:
Prohibition of Passive Yield: There are plans to ban interest-like payments for stablecoins held idly (sitting dormant) in wallets.
Transaction-Based Rewards: Discussions are underway to permit yields only when they are tied to specific commercial activities, transactions, or liquidity-providing functions.
This move by the administration aims to shift stablecoins away from being "deposit alternatives" and return them to their primary role as digital payment tools. However, industry representatives continue to warn that such restrictions could weaken the U.S. in global competition, potentially driving capital toward regions with more flexible regulations.
Market Expectations and the March Timeline
The White House goal of concluding these discussions by March 1 is seen as a strong signal that the era of "regulated yield" is about to begin in the crypto markets. If a consensus is reached, the legislative process for the CLARITY Act will accelerate, eliminating gray areas for institutional investors. Otherwise, continued uncertainty may remain a significant barrier to sectoral growth.