Overview

• The American Bankers Association, Bank Policy Institute and Consumer Bankers Association are lobbying to amend the GENIUS Act to bar indirect interest or rewards paid via exchanges or affiliates.
• The law prohibits issuers from paying yield, yet banks argue platforms could still reward holders of third‑party coins like USDC or USDT, citing a Treasury study that puts $6.6 trillion of deposits at risk.
• Crypto Council for Innovation, the Blockchain Association and Coinbase’s Paul Grewal dispute the “loophole” claim, arguing the provision supports competition and consumer choice.
• Regulatory implementation is underway, with the Federal Reserve on Aug. 15 ending its Novel Activities Supervision Program and folding crypto oversight back into standard supervision.
• A separate coalition of state regulators and consumer groups urged Congress to strike Section 16(d) of the Act, warning it could let certain state‑chartered uninsured entities bypass host‑state licensing.