Major US banks are lobbying to slow down new stablecoin legislation, but the White House has intervened directly, telling the banking industry to stand down.
US banks are mounting resistance to proposed stablecoin legislation moving through Congress, arguing the rules as written could expose the financial system to new risks and disadvantage traditional lenders. The pushback has now drawn a direct response from the White House, which has made clear it wants the bill to move forward without further delay from the banking lobby.
The American Bankers Association and other banking trade groups have warned lawmakers that stablecoin rewards could trigger as much as $6.6 trillion in deposit outflows, a figure they say the administration’s own economists have failed to account for properly. The White House Council of Economic Advisers responded with a 21-page analysis concluding that banning stablecoin yield would increase bank lending by just $2.1 billion, or roughly 0.02% of total US loans, while costing consumers an estimated $800 million in net welfare losses. The ABA fired back, saying the White House report “studied the wrong question,” arguing the real concern is not lending volume but deposit flight that would weaken community banks’ balance sheet flexibility.
Patrick Witt, executive director of the White House Crypto Council, has taken the fight public, writing on X that banks are “further lobbying out of greed or ignorance” and warning that the Clarity Act should not be “held hostage” by yield concerns the administration’s own data dismisses. The escalation came as the Clarity Act faced a potential delay from an expected April Senate Banking Committee markup into May, with bank lobbyists continuing to pressure legislators including Senator Thom Tillis to reopen a stablecoin yield compromise that had already been negotiated with crypto firms. As crypto.news reported, the North Carolina Bankers Association has been urging members to call Tillis’s office directly to demand changes to the yield language, threatening to unwind weeks of negotiation.
The Clarity Act is the crypto industry’s top legislative priority for 2026, and its fate has direct implications for digital asset markets. JPMorgan analysts have noted that passage of the bill could act as a major positive catalyst for digital assets in the second half of the year by finally resolving the regulatory split between the SEC and CFTC over crypto market structure. Senator Bernie Moreno has warned that if the bill does not reach the full Senate floor by May, crypto legislation may not advance before the 2026 midterm election cycle closes the window entirely.
How the banking lobby responds in the coming days could determine whether Congress has a clear path to a stablecoin vote before the summer recess.
