Stablecoin Inflows Rebound to $1.7 Billion Amid US Regulatory Debate Over Yield Policies

According to Messari's latest report, net stablecoin inflows rebounded to $1.7 billion last week, with a significant recovery in on-chain activity, despite ongoing heated debate in the US Congress and banking sector over whether stablecoins should be allowed to pay yield. This rebound turned the 30-day average daily inflow positive, reaching $162.5 million. During the same period, total transaction volume increased by 6.3% week-over-week, but the average transaction size continued to decline, reflecting a resurgence in demand for stablecoin issuance from retail investors and further activation of on-chain behavior. Stablecoin inflow measures the net increase in stablecoins entering circulation after deducting redemptions. It is widely believed that this trend indicates an increasing reliance on stablecoins as a liquidity tool by investors, especially against the backdrop of increased market volatility.

At the same time, the controversy surrounding stablecoin yield has slowed the progress of key US market structure legislation. The Senate Banking Committee markup, originally scheduled for mid-January, has been postponed indefinitely. The focus of the dispute is whether stablecoin issuers should be allowed to distribute interest to holders, a question that touches on the deep-seated conflict of interest between traditional finance and decentralized finance. Trump posted on the Truth Social platform: "The 'Genius Act' is being threatened and weakened by the banking industry, which is unacceptable - we will never stand idly by." This statement further exacerbates the dilemma faced by policymakers in balancing regulatory innovation and financial stability.