Overview
- More than 125 crypto firms and trade groups, led by the Blockchain Association, urged the Senate Banking Committee to reject efforts to reinterpret the GENIUS Act to bar third‑party rewards on stablecoin balances.
- Banking associations argue the issuer-only interest ban leaves a loophole and are lobbying for a blanket prohibition through Congress or broader market‑structure legislation.
- Crypto groups say Congress intentionally limited issuer‑paid yield while allowing platforms to offer lawful incentives, likening such rewards to cash‑back and loyalty programs.
- The coalition cites a Charles River Associates analysis and Federal Reserve data showing roughly $2.9 trillion in reserve balances to dispute claims that rewards would drain community‑bank deposits.
- Treasury and other agencies have begun implementing the GENIUS framework in a process expected to extend into 2026, and Senate leaders have signaled an early‑2026 markup where the rewards issue could reappear.