The cryptocurrency market has been embroiled in a contentious battle with the banking industry, with each side vying for influence over regulatory policy.
The latest development in this fight is the proposed compromise by Senators Tillis and Alsobrooks, which aims to prohibit stablecoin rewards from resembling interest on bank deposits. This would help address concerns about deposit flight, but banks argue that the language does not go far enough to achieve its goal.
Despite the banking industry's efforts, crypto firms are broadly willing to accept the compromise, which they see as a significant concession. The compromise also allows crypto companies to offer other forms of customer rewards and provides regulatory certainty needed to foster innovation.