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Banking Industry Calls for Amendment to Trump-Signed 'GENIUS Act,' Citing Potential Financial Risks
Summary: According to The Block, the largest banking industry association in the US is urging senators to patch up what they see as loopholes in the stablecoin legislation signed by President Trump last month, warning that these gaps could harm the broader financial system. This week, the American Bankers Association (ABA) and 52 other banking industry ...
According to The Block, the largest banking industry association in the US is urging senators to patch up what they see as loopholes in the stablecoin legislation signed by President Trump last month, warning that these gaps could harm the broader financial system. This week, the American Bankers Association (ABA) and 52 other banking industry organizations sent a letter to the Senate Banking Committee leadership, proposing revisions to the 'US Stablecoin Guidance and Establishment of National Innovation Act' (GENIUS). The letter highlights concerns in areas such as interest payments, state-level regulation, and stablecoin issuance by non-financial companies. The controversy centers around the prohibition in the GENIUS Act on stablecoin issuers paying interest to holders, which is seen as too lenient. While these groups support the restrictions, they believe the new legislation could easily be circumvented by exchanges, brokers, and other affiliates, distorting market incentives and potentially turning stablecoins from mere payment tools into potential value stores and credit instruments.
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Link: Banking Industry Calls for Amendment to Trump-Signed 'GENIUS Act,' Citing Potential Financial Risks [Copy]
