TL;DR
- White House negotiations on stablecoin legislation are deadlocked after two high-level meetings yielded no compromise.
- The banking industry is demanding a complete ban on stablecoin yields to protect traditional bank deposits.
- Senate Democrats are adding further conditions, including stronger illicit finance safeguards.
Two meetings at the White House on stablecoin legislation, and the two sides still sit in the same positions they held at the start. Crypto industry executives and representatives from the country’s largest banks gathered again on Tuesday under instructions from President Trump’s crypto advisers to find workable common ground. They left without it.
The banking negotiators did not arrive with compromise proposals. They arrived with a formal “principles” document calling for a complete ban on stablecoin yields — defined in the document as any financial or non-financial benefit offered to a payment stablecoin holder in connection with their purchase, use, ownership, custody, or retention of the asset.
The language covers every form of reward program currently used by major crypto platforms, not just a subset. For the crypto side, the document read less like a negotiating opening and more like a hard line.
Representatives from Coinbase, Ripple, a16z, the Crypto Council for Innovation (CCI), and the Blockchain Association sat across the table from the banking contingent, which included groups affiliated with the Bank Policy Institute and the American Bankers Association. The White House trimmed attendance from the previous week’s gathering after that session also failed to move the needle. The reduction in participants did not change the outcome.
The Core Dispute Behind the Legislative Deadlock
The fight over stablecoin yields sits at the center of the effort to advance the Digital Asset Market Clarity Act through the Senate Banking Committee. The bill already cleared the Senate Agriculture Committee and passed a version in the House last year. Banking industry representatives have consistently argued that allowing stablecoin issuers to pay yields draws deposits away from traditional banks — deposits they describe as the fuel for local lending and broader economic activity.
Crypto groups issued measured statements after the meeting
Blockchain Association CEO Summer Mersinger said stakeholders remain constructively engaged on resolving outstanding issues. CCI CEO Ji Kim thanked the banking industry for their continued participation. The banking coalition released a joint statement but included no specifics on a path forward for the legislation.
Patrick Witt, Trump’s crypto adviser and reported moderator of both recent White House sessions, previously told reporters he expects the sides to find common ground soon. He also made clear the White House will not support any provision that targets the president directly — a line drawn in response to Democratic negotiators who pushed for a ban on deep crypto involvement by senior government officials, a demand driven largely by Trump’s personal crypto holdings.
Senate Democrats added two more conditions to their support: stronger safeguards against the use of crypto in illicit finance, and full staffing of the Commodity Futures Trading Commission — including Democratic appointees — before the agency gains authority to regulate crypto markets.
