US President Donald Trump has hit out at banks for stopping a crypto market structure bill from advancing in the Senate on stablecoin revenue payments.
“The Genius Act is being threatened and undermined by the banks and that is unacceptable – We will not allow it,” Trump said on his Social Truth platform on Tuesday, referring to the GENIUS Act, which Congress passed in July to regulate stablecoins.
“The U.S. needs to complete the market structure as soon as possible,” he said. “Banks are making record profits and we don’t want to let them undermine our powerful Crypto agenda going to China and other countries if we don’t review the Transparency Act.”
Trump cited the GENIUS Act as his crowning achievement in attracting crypto companies to the US. The law gives stablecoin issuers a way to regulate, but prohibits them from directly offering revenue payments to holders.
However, third-party platforms such as crypto exchanges can still offer income to users who hold stablecoins.
Banking groups have argued that this is a legal loophole and are pushing to introduce a crypto market structure bill in the Senate that would include a ban on all stablecoin revenue payments. The House passed a version of the bill, called the CLARITY Act, in July.
“Banks should not try to undermine the Genius Act or hold the Enlightenment Act hostage. They should make a good deal with the crypto industry because it’s in the best interest of the American people,” Trump said.
Crypto executives and lobbyists have resisted efforts by banks to include a ban on fixed income payments in the bill, and Coinbase’s main lobbyist withdrew his support from the legislation in January over the issue.
Since then, the legislation has been delayed as the Senate Banking Committee adjourned after Coinbase withdrew its support in January and has yet to set a date for the legislation.
Banking groups have said that stablecoin revenue payments will see money move from bank accounts to stablecoins, putting the stability of the banking system at risk.
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Crypto and banking groups have held three meetings at the White House this year to agree on language that could advance the bill, but no agreement has yet been reached.
Trump is trying to pass the bill as a political win to pass in November during the midterms, where crypto lobby groups have raised more than $200 million to support the industry.
Hill says the Senate should consider the bill
Representative Francie Hill, the top Republican and chairman of the House Financial Services Committee, said at an event Tuesday that the Senate should consider taking up the House version of the crypto bill if it can’t move forward on its own.
Hill said the House CLARITY Act “confirmed the language in (the GENIUS Act) on a bicameral, bipartisan basis that stablecoins are a payment device on the blockchain, not an investment device, and they don’t pay interest.”
“If the Senate doesn’t come to a direct conclusion here, I suggest they use the language that we have in the Clarity Act passed by the 78th House Democratic vote and use that as a solution,” he said.
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