Clarity Bill: White House Supports Crypto in the Stablecoin Yield Battle With Banks

The White House has released a report that squashes the banking industry’s claims on the negative impact of stablecoin yield on their operations.

The new report from the White House’s Council of Economic Advisers suggests that restricting stablecoin rewards may have minimal impact on banks’ lending services, adding another layer to the ongoing Clarity Act policy debate in the United States.

Key Points

• A new report from the White House’s Council of Economic Advisers suggests that restricting stablecoin rewards may have minimal impact on banks’ lending services.
• Prohibiting yield offerings on stablecoins from the Clarity Act would increase traditional lending by just 0.02%, equivalent to about $2.1 billion.
• Per the report, this will add only $500 million to community banks, while larger ones will increase their lending capacity by $1.6 trillion.
• Restricting such rewards would provide little protection for lending activity in banks while removing potential benefits for consumers seeking competitive returns.

Stablecoin Yield Not a Problem: White House

According to the Wednesday report, prohibiting yield offerings on stablecoins from the Clarity Act would increase traditional lending by just 0.02%, equivalent to about $2.1 billion. However, most of this effect would likely benefit larger financial institutions rather than community banks.

If stablecoin yields are removed, larger banks will control 76% of the additional lending, while smaller banks (those with assets less than $10 billion) will control 24%. Per the report, this will add only $500 million to community banks, while larger ones will increase their lending capacity by $1.6 trillion.

As such, the economists argued that the broader impact on the banking sector would be limited, insisting that its effect has been exaggerated. They also added that restricting such rewards would provide little protection for lending activity in banks while removing potential benefits for consumers seeking competitive returns.

Report Challenges Banking Industry Concerns

This position contrasts with claims from the Independent Community Bankers of America, which has warned that smaller banks could face significant losses if stablecoin rewards are widely permitted. The group previously suggested that as much as $1.3 trillion in deposits and $850 billion in loans could be at risk.

The Bank of America also shared an even more preposterous projection. Its CEO, Brian Moynihan, stated that these rewards would attract $6 trillion in deposits from banks, representing 35% of their total deposits.

However, the White House-backed analysis presents a much smaller projected effect, highlighting the gap between the two perspectives. While banning stablecoin yield could boost lending, they emphasized it would only, at most, have a 6.7% or $129 billion boost for community banks’ lending in “implausible conditions.”

Regulation Debate Continues Around Stablecoins

Notably, stablecoins remain central to the discussion. These assets are typically pegged to the U.S. dollar and designed to maintain stable value, making them attractive for payments and other financial applications.

In July 2025, Donald Trump signed the GENIUS Act into law, offering a regulatory framework for stablecoin issuers. The law restricts issuers from offering direct yield but still allows third-party platforms to provide rewards linked to stablecoin balances.

As a result, regulators are seeking to address this cap in the proposed Digital Asset Market Clarity Act by either banning such rewards entirely or formally recognizing them. However, disagreements between the banking sector and digital asset firms have delayed the passage of the bill in the US Senate.

Consequently, ongoing negotiations led by the White House aim to find a compromise that balances innovation with financial stability. The Wednesday report appears to back stablecoin yield, which is in favor of the crypto sector.