Crypto Giants Battle Banks Over Stablecoin Reward Programs

TheNewsCryptoPublicado a 2025-12-20Actualizado a 2025-12-20

Resumen

A coalition of over 125 crypto companies is advocating for the protection of stablecoin reward programs amid opposition from traditional banks. The dispute centers on the GENIUS Act, which currently allows platforms—but not issuers—to offer rewards. Banking groups are pushing to extend restrictions to platforms, arguing that such programs carry risks similar to interest paid by issuers. The crypto industry, led by groups like the Blockchain Association, compares these rewards to credit card incentives and warns that limiting them would harm competition and innovation. They emphasize that stablecoin rewards offer significantly higher returns than traditional bank accounts, which yield minimal interest, and argue that restricting these programs would primarily benefit large banks at the expense of consumers and fintech firms.

Over 125 crypto companies have come together to form a coalition that aims to safeguard stablecoin reward programs from limitations that may be imposed by the traditional banking sector. This group of companies has written a letter to Congress advocating for their freedom to provide attractive returns to clients via digital assets.

The disagreement is about the GENIUS Act, which defines distinct roles for stablecoin issuers and the intermediaries that are the platforms, such as exchanges. According to this setting, issuers are not allowed to give interest in a direct way, but platforms still have the option to offer rewards to their users.

Banking Industry Challenges Stablecoin Platform Rewards

Tyler Winklevoss, Gemini co-founder, in a tweet, lambasted banks for reopening settled legislative matters by using regulatory pressure tactics. In his opinion, traditional financial institutions are crossing the line by questioning the established framework, which Congress has already approved.

Now banking groups are urging legislators to not only extend the limitations to issuers but also include platform, based rewards. According to them, these reward programs entail similar risks as the issuer, paid interest; however, the crypto coalition vehemently disagrees with this position.

The sector compares the situation to credit card rewards, which continue to function despite the fact that banks are not allowed to pay interest on deposits. This comparison demonstrates that intermediary platforms can provide advantages without raising the same regulatory issues as direct issuer payments.

The Blockchain Association led a coordinated campaign that attracted support from significant crypto exchanges like Gemini, Coinbase, and Kraken to the Senate Banking Committee leadership. According to the coalition, a restriction on platform incentives would “cut the heart out of competition” in the financial services market in the U. S. across the country.

The question of how ordinary people would be affected by such a move is still at the core of the argument. Traditional bank accounts hardly bring any returns as opposed to crypto ones. Average checking accounts give roughly 0.07%, while savings accounts offer about 0.40% yearly returns to depositors.

Stablecoin incentive schemes provide substantially more returns; thus, they become appealing alternatives for users looking for higher profits from their holdings. The crypto industry cautions that a limitation of such programs would be a transfer of benefits to big banks, with a subsequent disadvantage to small fintech firms.

While big banks aim to be the ones issuing stablecoins in the near future, the industry watchers are saying that the timing of the regulatory crackdown looks like a deliberate move. The group argues that keeping platform rewards is a key factor in ensuring the competitiveness of innovation in digital payment services.

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Preguntas relacionadas

QWhat is the main goal of the coalition formed by over 125 crypto companies?

AThe coalition aims to safeguard stablecoin reward programs from limitations that may be imposed by the traditional banking sector and advocate for their ability to provide attractive returns to clients via digital assets.

QWhich specific legislation is at the center of the disagreement between crypto companies and banks?

AThe disagreement is about the GENIUS Act, which defines distinct roles for stablecoin issuers and intermediary platforms, prohibiting issuers from directly offering interest but allowing platforms to provide rewards.

QHow does the crypto industry compare stablecoin reward programs to traditional financial products?

AThe crypto industry compares stablecoin reward programs to credit card rewards, arguing that platforms can provide benefits without the same regulatory issues as direct issuer payments, similar to how credit card rewards function despite banks not being allowed to pay interest on deposits.

QWhat potential consequence does the crypto coalition warn about if platform rewards are restricted?

AThe crypto coalition warns that restricting platform rewards would 'cut the heart out of competition' in the U.S. financial services market, transferring benefits to big banks and disadvantaging small fintech firms.

QWhat significant difference in returns exists between traditional bank accounts and stablecoin incentive schemes?

ATraditional checking accounts offer approximately 0.07% annual returns and savings accounts about 0.40%, while stablecoin incentive schemes provide substantially higher returns, making them appealing alternatives for users seeking higher profits from their holdings.

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