Live from the White House Crypto Meeting: Banking Industry and Crypto Giants Engage in a Two-Hour Debate — What Are They Really Arguing About?

Written by: Blockchain Knight

On Monday, White House officials met with leaders of the crypto industry and major banking groups in an effort to ease a key regulatory dispute that has slowed the long-anticipated progress of legislation on market structure for cryptocurrencies (the “CLARITY Act”).

The meeting focused on one of the most controversial issues blocking the bill: whether stablecoin issuers and related third parties should be allowed to offer yields or rewards on stablecoin holdings.

The discussion took place against the backdrop of ongoing lobbying by the banking sector, which has been urging lawmakers to include provisions in the CLARITY Act that prohibit issuers and third parties from offering rewards linked to stablecoins.

However, the crypto industry argues that such restrictions would tilt the competitive landscape in favor of traditional financial institutions. They note that traditional banks are increasingly concerned about competition from digital asset companies.

Eleanor Terrett of Crypto In America shared more details about the meeting, citing sources familiar with the matter.

According to Terrett, the meeting lasted two hours, with a lively atmosphere, and participants engaged in balanced discussions about the risks and potential rewards of stablecoin yields.

The meeting brought together numerous stakeholders, including representatives from major banking institutions such as the American Bankers Association, the Bank Policy Institute, the Financial Services Forum, the Independent Community Bankers of America, and the Consumer Bankers Association.

Participants also included firms like Fidelity Investments, PayPal, Paradigm, SoFi, Coinbase, Paxos, Crypto.com, Kraken, Ripple, and Tether, as well as advocacy organizations such as the Blockchain Association, the Digital Chamber of Commerce, and the Crypto Council.

Other participants included Stripe, Galaxy Digital, Multicoin, Circle, and Cantor.

After the meeting, Cody Carbone, President of the Digital Chamber of Commerce and head of crypto policy, said the discussion was an important step forward.

Cody stated that the meeting “represents the progress needed to address one of the biggest issues hindering the advancement of market structure legislation.”

Patrick Witt, Executive Director of the White House Crypto Committee, also shared the same view. He thanked the crypto and banking industry participants, describing the discussion as fact-based and solution-oriented.

Patrick pointed out that over the past few months, policymakers and industry leaders have made progress on several policy challenges once thought unsolvable, and he expressed confidence that the issue of stablecoin rewards can also be resolved through continued dialogue.

The banking groups involved in the meeting also issued a joint statement reaffirming their positions. They emphasized that any final legislation should continue to support local lending to families and small businesses, maintain financial stability, and promote sustainable economic growth.

Despite the apparent progress, the legislative process remains uncertain. It is still unclear whether the Senate Banking Committee will follow the approach of the Senate Committee.

The committee approved relevant parts of the CLARITY Act during a routine review last Thursday, clearing an important procedural hurdle.