TL;DR
- Deaton criticized U.S. banks during White House CLARITY Act talks as stablecoin yield restrictions became a flashpoint for now.
- Crypto representatives included Ripple, Coinbase, a16z and the Blockchain Association; banks included ABA, BPI and ICBA, with idle-balance yield now off the table.
- Debate shifted to activity-linked rewards and possible anti-evasion penalties of $500,000 per day via SEC, Treasury and CFTC, leaving issuers to keep yield features modular.
Stablecoin yield restrictions have become a new fault line in Washington, after Ripple supporter and lawyer John Deaton blasted U.S. banks during White House discussions tied to the CLARITY Act. Banks versus stablecoin yields is now the headline battle as crypto companies and legislators debate whether rewards on dollar tokens should be curtailed. Deaton amplified journalist Eleanor Terrett’s reporting on the talks and argued banks have long acted against ordinary users. The backdrop is a policy sprint where industry wants pro-crypto rules and banks seek tighter limits. This dispute looks like competition over deposits too.
Banks have been the enemy of regular people for as long as I’ve been alive. https://t.co/WefxFqOcI2
— John E Deaton (@JohnEDeaton1) February 20, 2026
Inside the White House stablecoin yield standoff
The White House session brought heavyweight representation on both sides. A crowded negotiating table signals how high the stakes are: Ripple, Coinbase, a16z and the Blockchain Association were cited on the crypto side, while the American Bankers Association, Bank Policy Institute, and Independent Community Bankers of America represented banks. Participants described the meeting as productive and constructive, and Terrett reported that one major request is already off the table, earning yield on idle crypto balances. The remaining debate centers on whether rewards can be linked to specific user activities. That distinction could shape product design.
Even as progress was cited, Terrett said she is hearing mixed messages from both camps. Contradictory spin is becoming part of the strategy: crypto participants describe momentum, while banks also tell a positive story and still want strict enforcement tools. One sticking point is an “anti-evasion” posture that banks hope to impose, including penalties of $500,000 per day routed through the SEC, Treasury, and CFTC. Deaton reacted by calling banks “the enemy of regular people” long before crypto, reinforcing the fear-of-competition framing. For compliance teams, the question is which regulator owns perimeter and how fast.
The episode underscores a broader governance challenge as stablecoins move from niche rails to mainstream payment and treasury tools. Policy outcomes now hinge on where “rewards” are allowed to sit within the emerging rulebook. Terrett reported that any future restrictions on rewards would be strictly limited, but the exact boundary is still being negotiated, especially around incentives tied to activity rather than idle balances. Until that line is clarified, issuers and platforms may keep yield features modular and easily switched off. Stakeholders will watch for the next update from the White House talks and lawmakers.
