US Cryptocurrency Legislation Makes Progress on Stablecoin Rewards

The US administration has taken a crucial step towards resolving the long-standing dispute over stablecoin rewards in the cryptocurrency market. A recent closed-door meeting between representatives from crypto companies and bank associations resulted in significant progress, narrowing the gap on the issue of rewarding users for specific activities.

According to sources, the discussion focused on whether or not to offer rewards tied to specific actions, such as trading volume or network participation, rather than idle stablecoin balances. This shift in focus marks a significant development in the regulatory process, which has been stalled due to disagreements over the potential risks and benefits of stablecoin rewards.

The meeting also addressed the proposed 'anti-evasion' provisions, which would authorize agencies like the SEC, Treasury Department, and CFTC to enforce the ban on idle balance returns. Violations of this ban could result in fines of up to $500,000 per day.

Patrick Witt, Executive Director of the White House Crypto Council, emphasized that resolving the issue of stablecoin rewards could have a 'domino effect' and accelerate the process of market structure regulation. The parties aim to reach an agreement by March 1st, which could pave the way for the rescheduled Senate Banking Committee hearing.