Cryptocurrency Legislation in the U.S. Faces Ongoing Challenges: Stablecoin Performance Debate Structure Remains Unresolved

The structure of the past continuous in U.S. crypto policy negotiations is evident in the repetitive cycle of dialogues between regulators, banks, and the crypto industry, where each meeting leaves unresolved the same core issues. A second White House-mediated session between cryptocurrency leaders and banking representatives concluded without a definitive agreement, highlighting how fundamental divisions over stablecoin treatment continue to stall legislative progress.

White House intensifies mediation efforts: Two meetings in two weeks

The recent dialogue marks the administration’s second intervention in two weeks to bridge positions on the structure of the U.S. crypto market. Although Stuart Alderoty, a participant in the meeting, described the exchanges as “productive sessions” where “commitment is in the air,” the reality reflects a more complex pattern of failed approaches that keep longstanding conflicts alive.

The first session, held in February, was characterized by Patrick Witt as “constructive” and “fact-based.” However, this characterization contrasts with the persistence of fundamental disagreements that subsequent meetings have failed to resolve. The initial momentum from the approval of the CLARITY Act by the House in July reached its limit in the Senate, where bipartisan support proved insufficient to move forward.

Stablecoins’ performance: An unresolved core of the dispute

The issue of performance linked to stablecoins emerged as the main point of friction in these discussions. Coinbase had withdrawn its legislative support months earlier, citing concerns over provisions that would restrict all payments of yields associated with these digital assets. This corporate stance crystallized an irreconcilable conflict of principles between two visions of the financial ecosystem.

Dan Spuller noted that the latest session was a “smaller meeting focused on solving specific problems,” where stablecoin yields took center stage. According to his analysis, “banks did not come to negotiate from the text of the law but with broad prohibitive principles,” which represented a fundamental obstacle to finding common ground.

Banking sector representatives circulated documents advocating for “principles of prohibition of yield and interest,” reflecting their thesis that allowing yields on stablecoins—especially when channeled through third-party platforms like exchanges—could jeopardize traditional bank deposits and weaken overall financial stability.

Irreconcilable positions: Banks versus crypto industry

Three major banking coalitions—the American Bankers Association, the Banking Policy Institute, and the Independent Community Bankers of America—issued a joint statement urging for “continued discussions” as a mechanism to advance. They emphasized that any regulatory framework should balance innovation with the protection of financial security and deposits.

However, crypto industry executives presented an alternative strategy: decoupling the debate over stablecoin yields from broader market structure reforms. Mike Belshe argued that both sides should cease reviewing the GENUIS Act, which already directly restricts stablecoin issuers’ ability to pay yields. “That battle has already been fought,” he declared. “Market structure has nothing to do with stablecoin yields and should not be delayed further.”

Perspectives: Where is crypto legislation heading?

The persistence of these divisions underscores the deep challenges facing lawmakers in finalizing comprehensive regulations on stablecoins within a broader bill that reorganizes the crypto market structure. Ongoing discussions between regulators, banks, and the crypto industry reveal rhetorical commitment, but the lack of tangible agreements demonstrates that the pattern of the past continuous—where the same frictions resurface in each negotiation round—remains the dominant pattern in the U.S. regulatory landscape for digital assets.