Crypto executives are reportedly making a last-ditch effort to convince Congress to allow stablecoin issuers to pass on interest to holders of dollar-pegged digital assets.
Digital asset industry leaders are lobbying for stablecoin regulations to include a provision that enables issuers to share interest with users, reports Reuters.
[adinserter block="1"]Stablecoins maintain a stable value by being backed 1:1 by real-world assets like the US dollar. Issuers typically invest their dollar reserves in low-risk assets like US Treasuries to generate yield. Interest earned on investments could be used to incentivize holders, much like how banks pay interest to depositors.
Says Coinbase CEO Brian Armstrong,
“Unlike interest-bearing checking and savings accounts, stablecoins do not currently benefit from the same exemptions under the securities laws that allow issuers to pay interest to users. Stablecoins should be able to pay interest just like an ordinary savings account, without the onerous disclosure requirements and tax implications imposed by securities laws.”
Last month, the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act secured support from the Senate Banking Committee with a bipartisan 18-6 vote. And last week, the House Financial Services Committee passed the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act of 2025 with a 32-17 vote.
The STABLE Act of 2025 states that stablecoin issuers are prohibited from paying yield to holders, while the GENIUS Act has vague language on the matter.
A source with knowledge on the matter says that lawmakers are open-minded on the possibility of including a provision that allows issuers to pay interest on stablecoin holdings.
But traditional financial firms are opposing the move. The American Bankers Association says in a statement to the House Financial Services Committee that the provision will likely drive consumers to move money out of their bank accounts and into stablecoin wallets.
“This concept is not a mere competitive concern; rather, it poses a significant risk to the fundamental role banks play in credit intermediation.”
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