Banks fight stablecoin yield ahead of Senate vote

Banking groups are intensifying their lobbying efforts against the Senate's Clarity Act, warning that its current provisions could encourage a significant outflow of deposits into yield-bearing stablecoins. The American Bankers Association argues that such stablecoins could substitute for insured bank deposits, potentially draining funds needed for mortgages and business loans. Conversely, crypto and fintech firms contend that stablecoins offer faster payments and innovative ways to transfer money digitally. This conflict over stablecoin yield is complicating broader cryptocurrency legislation as the Senate Banking Committee prepares to vote on the Clarity Act this week.