- White House pushes compromise on stablecoin rewards, letting some incentives remain while protecting bank deposits and lending.
- Banks agree to reward limits tied to transactions, avoiding interest-like payouts, aiming to meet the March 1 deadline.
- Democratic lawmakers push for tighter DeFi oversight, leaving stablecoin reward plans cautiously positive but still uncertain.
The White House may have made real progress on the U.S. stablecoin debate during a private meeting with top banking and crypto leaders on Thursday. The talks, connected to the Senate’s Digital Asset Market Clarity Act, focused on one big question: should people holding stablecoins be allowed to earn rewards?
Officials from the White House suggested that limited rewards could stay in the bill, a change from the earlier uncertainty. Banks had pushed for a complete ban, warning that rewards might pull money away from traditional deposits and hurt lending. However, both sides explored a middle ground, letting rewards happen only for specific transactions rather than just holding stablecoins.
The third round of talks included key stakeholders from major banks and crypto firms. Patrick Witt, President Trump’s crypto adviser, led the White House team and stressed urgency. “Move quickly so broader legislation can advance,” he reportedly told participants.
Negotiators focused on creating a middle ground that protects traditional banking interests while allowing limited incentives for stablecoin use. Consequently, the talks aimed to reconcile provisions under last year’s GENIUS Act with the Clarity Act’s broader regulatory framework.
Banking Compromise and Stablecoin Incentives
Banks suggested limiting rewards programs that act like traditional interest, while still allowing bonuses tied to specific transactions or actions. The White House also urged both sides to agree on the wording before the March 1 deadline.
No final deal was reached, but sources described the talks as positive. A new draft reflecting the compromise will be shared, and banks will review it before anything is finalized. If approved, these changes could appear in the next version of the market clarity bill, improving its chances in the Senate.
Even with progress, challenges remain. Some Democratic lawmakers want stricter oversight of decentralized finance platforms. The compromise also needs to balance innovation with financial safety. For stablecoin issuers, the White House’s support for limited rewards is cautiously encouraging.
