The White House is preparing to bring together top representatives from the banking and crypto sectors next week to try to overcome the Senate deadlock on cryptocurrency legislation. According to Reuters, citing three sources familiar with the matter, the meeting will focus particularly on reward mechanisms related to stablecoins. This has become a key point of disagreement that has hampered progress in the Senate Banking Committee in recent months. The summit will reportedly be organized by the White House crypto council. The discussions will center on uncertainties surrounding the implementation of the GENIUS Act, passed by Congress this summer, which provides a framework for stablecoins. While this legislation prohibits stablecoin issuers from receiving direct interest payments, it doesn't completely close the door on third-party platforms (including crypto exchanges) offering various rewards to users. The banking sector argues that this flexibility could lead to deposit losses. The Blockchain Association is one of the institutions that has confirmed its participation in the meeting. In a statement, the union's CEO, Summer Mersinger, said that Congress has the opportunity at this stage to establish clear and bipartisan rules. According to Mersinger, a framework that protects consumers, encourages responsible innovation, and preserves the US's global leadership in financial technologies should no longer be delayed.
What's happening between banks and crypto companies?
Recently, tensions between banks and crypto companies have been steadily increasing. Banking unions argue that the insufficient limitation of reward mechanisms in the GENIUS Act will particularly put local and regional banks in a difficult position. The crypto side, on the other hand, argues that banks are trying to suppress competition, that these issues were negotiated before the law was passed, and that the sector was targeted at the last minute. At the heart of the discussions is the question of whether rewards should be considered a form of "interest." This disagreement directly affected the legislative calendar in the Senate. A hearing planned by the Senate Banking Committee in mid-January was canceled at the last minute after crypto exchange Coinbase withdrew its support. Coinbase cited its dissatisfaction with the lack of clarity regarding the approach to tokenized shares and stablecoin rewards. The Senate Agriculture Committee is preparing to hold a hearing this week; however, it is reported that the draft text presented last week did not receive sufficient support from the Democrats. On the White House side, there is a clear will to accelerate the process. Patrick Witt, who serves on the President's Digital Assets Advisory Council, emphasized that the US should pass comprehensive legislation regarding the crypto market structure without delay. Witt noted that the current crypto-friendly political climate may not be permanent and that action should be taken before momentum is lost. According to him, such legislation is inevitable; the only debate is when it will be implemented. The summit planned for next week is therefore seen as a critical turning point. It is expected that the deepening disagreements between banks and crypto companies will be discussed, and that common ground will be sought, particularly regarding stablecoin rewards. The messages that emerge from the meeting could provide important signals determining whether the Senate negotiations will get back on track and what path the US will take in crypto regulation.
