The American Bankers Association (ABA), the Independent Community Bankers of America (ICBA), and 76 state banking associations have called on Senate leaders to make targeted changes to stablecoin yield provisions in the Clarity Act.
In a joint letter sent to Senate Majority Leader John Thune and Minority Leader Charles Schumer on Monday, the groups stressed the need for clearer guardrails around payment stablecoins.
In particular, they argued that ambiguities in Section 404 could enable stablecoin arrangements to function as substitutes for deposits, potentially leading to deposit flight from community banks.
Section 404 includes language banning crypto firms from paying direct or indirect interest or yield on payment stablecoins. However, it permits activity-based or transaction-based rewards.
Section 404
