The debate over stablecoin yields in the U.S. has resurfaced this week, with Eric Trump, son of former President Donald Trump and co-founder of World Liberty Financial, publicly criticizing major financial institutions for allegedly lobbying to prevent crypto platforms from offering stablecoin yields to users.
On March 5, he posted on X (formerly Twitter) that traditional banks such as JPMorgan Chase, Bank of America, and Wells Fargo are actively lobbying Congress to curb crypto platforms from offering annualized stablecoin yields of 4% to 5% or higher. "These institutions are desperately trying to suppress crypto stablecoins because they offer returns far higher than traditional savings accounts, and their profits depend on the huge spread between the Fed rate and what they pay depositors."
This controversy revolves around the legislative process of the Clarity Act, which aims to establish a clearer regulatory framework for the digital asset market. However, the clause regarding whether stablecoin issuers should be allowed to distribute yields to users has become the core of the game between all parties.
Supporters argue that yield-bearing stablecoins provide the public with an alternative to the low-interest savings offered by traditional banks. Eric Trump further pointed out that institutions such as the American Bankers Association (ABA) are spending millions of dollars in lobbying funds, attempting to ban or restrict such yields through legislation. Their true intention is to maintain the traditional banks' monopoly on the low-interest deposit market and prevent user funds from flowing to high-yield crypto financial products.
In response, banking organizations argue that if stablecoin issuers provide bank-like yield services, they should be subject to the same level of regulatory constraints to ensure financial stability and consumer protection.
Eric Trump Blasts Big Banks for Blocking Stablecoin Yield Innovation
Eric Trump accuses big banks of lobbying to block high stablecoin yields, revealing a deep game between traditional finance and the crypto economy on savings rates, fueling regulatory controversy over the Clarity Act.