The White House is considering another closed-door meeting between top banking executives and cryptocurrency industry leaders after the latest negotiations failed to resolve a key dispute over stablecoin yield rules, leaving major crypto legislation hanging in the balance.
According to crypto reporter Eleanor Terrett, sources indicate the next meeting could take place as early as Thursday. The urgency reflects growing concern inside Washington that disagreements over stablecoin rewards could derail progress on the Digital Asset Market Clarity Act, one of the most significant crypto regulatory efforts currently under discussion.
Stablecoin Rewards Remain the Core Sticking Point
At the heart of the debate is whether dollar-pegged stablecoin issuers or platforms should be allowed to offer interest-like rewards to token holders.
The White House has already hosted multiple meetings in an effort to broker compromise, including a high-level discussion on February 3, 2026. That session brought together major banking institutions and leading crypto firms, but it ended without consensus. Officials are now exploring revised legislative language in an attempt to narrow the gap.
Rather than serving as another general policy discussion, the upcoming session is expected to function more like a technical drafting workshop, with policymakers and industry participants attempting to refine specific wording around how stablecoin rewards would be treated under federal law.
Without agreement on this issue, broader crypto market structure reforms remain effectively frozen.
Banks Warn of Deposit Flight Risks
Traditional financial institutions argue that allowing stablecoins to offer yield could destabilize the banking system.
Banks contend that reward-bearing stablecoins may incentivize consumers to move deposits out of regulated banks, potentially weakening liquidity and raising systemic risks. According to projections cited by Standard Chartered, U.S. banks could lose as much as $500 billion in deposits by 2028 if stablecoins offering competitive returns gain widespread adoption.
From the banking sector’s perspective, stablecoin yields risk creating what they view as a form of parallel, lightly regulated banking infrastructure that competes directly with traditional deposits but without equivalent oversight.
Crypto Firms Push Back on Restrictions
Crypto industry leaders counter that banning stablecoin rewards would stifle innovation and limit consumer choice.
They argue that users are already actively seeking higher yields through decentralized finance platforms and offshore services. Restricting regulated U.S. stablecoin issuers from offering rewards, they say, would simply push consumers toward less transparent or less compliant alternatives.
Major crypto advocacy groups, including the Blockchain Association, alongside prominent U.S.-facing exchanges such as Coinbase, have participated in discussions. Their involvement underscores how pivotal the stablecoin yield issue has become for the future of U.S. digital asset policy.
Industry representatives maintain that properly regulated reward mechanisms could operate safely within a clear legal framework, rather than being prohibited outright.
Regulatory Momentum at Risk
The White House has been under pressure to advance digital asset legislation before political momentum fades. Stablecoins are widely seen as one of the most immediate use cases for crypto within the broader financial system, making the debate especially consequential.
While previous meetings have improved mutual understanding between banks and crypto firms, negotiators have yet to produce a compromise acceptable to both sides. Each round of talks has revealed progress in technical discussions but no breakthrough on the core yield question.
As discussions continue, the outcome will likely shape not only the fate of the Digital Asset Market Clarity Act but also the broader direction of U.S. stablecoin policy.
For now, the stablecoin yield debate remains the single biggest obstacle preventing the finalization of comprehensive crypto regulation in the United States.
