Today in Crypto: Community Bankers Demand Total Ban on Stablecoin Rewards

According to recent market coverage, community banks are leading the opposition to the CLARITY Act, stressing that there is no middle ground on the stablecoin yield issue.

Rebeca Romero Rainey, president and CEO of Independent Community Bankers of America, said that this so-called “loophole” had to be “closed entirely.” Passing the Digital Asset Market Clarity Act has become a difficult task, as issues believed to be solved rise again.

While both parties, the crypto industry and big banking, had reached a compromise on the language to confine stablecoin rewards to activity rather than ownership, this key pain point has been revived by community banks, which have already swayed at least two Republican senators, Josh Hawley and Jerry Moran, to oppose CLARITY in its current form.

Independent Community Bankers of America (ICBA), a membership organization that groups roughly 5,000 community banks in the U.S., has recently updated its demands for changes to the CLARITY Act and highlighted how a wrong decision could affect the future of these institutions and the groups that receive credit through their intermediation.

In an interview with Banking Dive, Rebeca Romero Rainey, president and CEO of ICBA, declared that the discussion around these rewards should not revolve around compromise, as the future of the community banking sector might be at stake.

“There’s always the suggestion, well, how do we make both sides happy on this?

For us, this loophole has to be closed entirely.

There’s not a middle ground in terms of resolution,” Romero said.