Overview

• Will Beeson, a former Standard Chartered tokenization lead, says enabling yield is crucial for stablecoins to compete and scale.
• The law bars issuers from paying interest, but third parties can offer incentives; Coinbase advertises rewards on USDC and Kraken lists higher rates.
• Bank trade groups warned on August 12 that exchange-paid rewards could shift up to $6.6 trillion from bank deposits and urged an explicit ban on platform payouts.
• Crypto industry groups countered on August 20 that the $6.6 trillion estimate is flawed and argued that restricting rewards would undercut innovation and U.S. competitiveness.
• Regulators are drafting rules under the new framework, which prioritizes holders in insolvency but provides no FDIC-style insurance, while the EU’s MiCA takes a stricter stance by prohibiting yields from issuers and platforms.