In response to lobbying from Wall Street banks, crypto group Stand With Crypto said it had asked its online members to message their states’ U.S. senators more than 250,000 times, fending off bankers’ attempt to block the ability to earn stablecoin rewards in the Guiding and Establishing National Innovation for American Stablecoins (GENIUS) Act.
The letter penned by Stand With Crypto – a US pro-crypto organization initially created by Coinbase – urges lawmakers to ignore banking industry advocates who launched an effort in August to rewrite the law to completely remove the ability of stablecoin issuers to offer returns to users.
“Lawmakers chose to protect rewards because you know they are intended for consumers,” according to the form letter that must be automatically sent to politicians in each member state if the member chooses to execute it. “A ban on rewards would prevent consumers from earning value with fully-backed digital dollars, even though banks lobbied to protect their credit card rewards as recently as last year.”
The GENIUS Act, which became law earlier this year and is already being passed by federal regulators, prevents stablecoin issuers from directly offering interest or returns, but it does not prevent the issuers’ affiliates or exchanges from doing so. As a result, bankers have argued that there could be a massive loss of deposits and money market fund activity as this rivalry with stablecoins emerges.
“Congress must protect the flow of credit to American businesses and families and the stability of America’s most important financial market by closing the stable currency interest payment loophole,” groups such as the American Bankers Association, the Bank Policy Institute, the Financial Services Forum and others argued in their own campaign.
Crypto lobbyists quickly responded to the bankers, seeking to protect the GENIUS Act – the first major crypto law approved in the United States.
While the U.S. Treasury Department and other financial regulators have said they have begun trying to implement the stablecoin law, their employees who would draft those regulations are currently largely sidetracked from that effort. The U.S. government is largely shut down due to a fiscal shutdown as Congress has abandoned the federal spending plan and has yet to agree on a path forward.
Stand With Crypto reports that more than 2.7 million crypto fans have registered with the organization.
