whitehouse

Limited stablecoin rewards are favored by the White House, and if bankers sign off, they'll be in the next draft of the crypto market structure bill, according to two people familiar with the negotiation.
At a Thursday working session meant to secure common ground on stablecoin rewards between banks and the crypto industry, the White House made it clear that certain rewards programs were going to stay in the next draft of the crypto market structure bill, the people said. Representatives of Wall Street banks that attended the meeting actively worked on that language, and the White House will put together an updated draft to circulate among them, they said.
This section of the U.S. Senate's Digital Asset Market Clarity Act — the crypto industry's top policy aim in Washington — is one of the major fault lines for the legislation that would govern the operations of U.S. crypto markets. As it happens, the stablecoin section (404 of the draft bill) has nothing directly to do with market structure, and the revisions being discussed would actually overhaul an earlier crypto effort that became law last year, the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act.
This was the third White House sitdown between bankers and crypto insiders, and after the bankers dug in their heels on allowing stablecoin rewards last time, White House negotiators arrived at the table with a position that some rewards must be allowed for certain activities and transactions, but not for holdings of stablecoins that more closely resemble deposit accounts. The White House team — led by President Donald Trump's crypto adviser, Patrick Witt — urged a quick resolution on this point that allows the legislation to move forward, the people said.
That reflects the fear expressed by bankers: that stablecoin rewards would undermine their bread-and-butter business model that depends on customers making interest-bearing deposits.
Participants at the meeting privately expressed hopes that the compromise they've waited for is potentially very close. Spokespeople for the White House didn't immediately respond to a request for comment.
"Today's meeting at the White House was a constructive step forward in resolving outstanding issues related to rewards and keeping market structure legislation on track," Blockchain Association CEO Summer Mersinger, who has been among those at the table, said in a statement after the gathering.
If the banks decline to shake hands on limited rewards, the status quo is the GENIUS Act, which gives crypto platforms a much freer hand with rewards programs than this proposal would. If they instead give this approach a nod, their agreement would be likely to sway reluctant senators back into support.
However, this is just one of several holes in the Clarity Act that need to be filled with negotiated language. The crypto industry also remains very involved in the requests from Democratic lawmakers that the bill ramp up the protections against bad actors in crypto, especially in the decentralized finance (DeFi) space.
Also, Democratic negotiators have insisted on a couple of other points that may put them at odds with the White House. They've demanded a ban on senior government officials getting directly involved in the crypto industry — a position targeted most directly at President Donald Trump. They've also called for the White House to name a full slate of commissions at the Commodity Futures Trading Commission and the Securities and Exchange Commission, including their Democratic vacancies.
None of the Democrats' major issues have yet been resolved. If the Senate Banking Committee moves forward with a hearing to advance the bill, as the Senate Agriculture Committee did, the outcome may again be partisan if the parties don't find answers to those points. That won't prevent the legislation's advancement through the next step, but it can't win approval from the overall Senate without significant Democratic support.
#stablecoin #Genisus #whitehouse
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March 1 Deadline Drives Bill Talks
The #whitehouse has set a March 1 target to accelerate negotiations on the Digital Asset Market Clarity Act, a bill that could reshape how digital assets are regulated in the United States.
#Ripple $XRP 's CEO Brad Garlinghouse recently stated on Fox Business that he sees a 90% chance the Clarity Act will pass by April, citing momentum in receent discussions and #Ripple💰 ’s own legal victories, including a federal court ruling that $XRP is not a security.
Banks, Crypto Leaders Hash Out Rewards
On Thursday, the White House hosted its third working session in just over two weeks, bringing together Wall Street banks and crypto industry representatives to debate how—and whether—stablecoin rewards should be allowed. Executives from Coinbase and Ripple participated alongside banking lobbyists as President Donald #TRUMP 's crypto adviser Patrick Witt led the talks. According to cointelegraph.com, specific language was discussed regarding how stablecoin rewards might be structured, with proposals surfacing to tie rewards to transaction activity rather than account balances.

Section 404 of the Clarity Act is under revision and could overhaul the GENIUS Act, which became law in 2023.
Despite three meetings in sixteen days, no final agreement has emerged.
The U.S. banking sector remains opposed to allowing crypto firms to offer yield-like incentives on stablecoins—a practice currently permitted under last year’s GENIUS Act. Bankers have pressed for stricter language in the Clarity Act’s Section 404 to limit or ban such rewards entirely. Meanwhile, crypto leaders argue that limited rewards could foster innovation without destabilizing financial markets.
Stablecoin Reward Debate Remains Stalled
While there is consensus emerging around some aspects of stablecoin regulation, the question of yield incentives remains unresolved. The White House appears willing to allow “limited” stablecoin rewards but is pushing for tighter controls in the next draft of the bill. Blockchain Association CEO Summer Mersinger described Thursday’s meeting as a “step forward,” but acknowledged that significant differences persist between industry and banking interests.
Democratic negotiators have added their own demands: they want senior government officials barred from direct involvement in crypto businesses and insist on filling Democratic vacancies at both the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC). These issues add layers of complexity for drafters already navigating competing priorities from banks and crypto firms.
Ripple CEO Sees Bill’s High Odds
Despite these hurdles, optimism remains high among some industry leaders. Brad Garlinghouse pointed to Ripple’s recent expansion—nearly $3 billion spent on acquisitions since 2023 in areas like custody and treasury management—as evidence that companies are preparing for a more clearly regulated environment. On paper, Wall Street banks have successfully slowed some provisions they oppose; but with Polymarket bettors assigning an 82% chance of passage by year-end, market sentiment suggests compromise is likely.
Still, it’s unclear if negotiators can bridge all gaps before the March 1 deadline set by the White House.
Key Findings
The White House set a March 1, 2024 target to accelerate negotiations on the Digital Asset Market Clarity Act.Ripple CEO Brad Garlinghouse estimates a 90% chance the Clarity Act will pass by April 2024.Section 404 of the Clarity Act is being revised to potentially limit stablecoin rewards, overhauling the 2023 GENIUS Act.
Upcoming market signals
The White House has set a March 1 target to push negotiations on the Clarity Act forward, and if a compromise on stablecoin rewards is reached in the next draft circulated to Wall Street banks, it would immediately signal progress toward resolving one of the bill's main sticking points; however, no deal has yet been confirmed following the latest meeting.

A high-stakes, closed-door session at the White House on February 19, 2026, has signaled a potential breakthrough in the war over stablecoin yields. As the "GENIUS Act" enters its critical implementation phase, the administration is pushing a compromise that could finally bridge the gap between Wall Street banks and crypto giants.

Trend Analysis: The Yield Compromise
The last 24 hours have seen a seismic shift in the US regulatory landscape. For months, a deadlock between traditional banking associations and crypto leaders like Circle and Coinbase threatened to derail the broader Clarity Act. The core of the conflict? Whether stablecoin issuers can pay rewards or "yield" to holders—a move banks fear will drain trillions in deposits from traditional accounts.
However, sources from yesterday’s third White House summit indicate the administration is now backing a "Hybrid Reward Model." This framework would allow limited rewards tied to specific transaction activities rather than passive holding. This "middle path" aims to preserve US dollar dominance via stablecoins while protecting the fractional reserve banking system. With Tether ($USDT ) recently hitting a $186B market cap and expanding into gold-backed assets, the US is under immense pressure to finalize these "rules of the road" before the July 18 implementation deadline.

Risk Warning
While the summit suggests progress, the "GENIUS Act" strictly prohibits algorithmic mechanisms and unregulated interest payments. Any failure to reach a final compromise could lead to a sudden "de-platforming" of non-compliant stablecoins from US-linked exchanges, causing significant liquidity shocks in the DeFi sector.

#Stablecoins #USDT #whitehouse #GENIUSAct #CryptoRegulation