In a Truth Social post, Trump lashed out at the big banks on Tuesday night over crypto. “The Genius Act is being threatened and undermined by the Banks, and that is unacceptable — We are not going to allow it,” the president wrote.
The country, he claims, “needs to get Market Structure done, ASAP.” He adds, “Americans should earn more money on their money.”
This concerns a proposed piece of crypto legislation, the CLARITY Act. The bill is mainly about clearly delineating the respective jurisdictions of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) over crypto assets. In practice, however, the bill is stalled out over bonuses crypto holders may or may not be able to receive in order to essentially compensate for the fact that crypto is considered digital cash and can’t collect interest.
As noted by Yahoo Finance, representatives of Banks are withholding their blessing because crypto firms are trying to essentially reverse engineer interest by providing rewards of perhaps 4-5%, that could drive people to pull their money out of bank accounts that provide relatively paltry yields.
“The Banks,” Trump’s Truth Social post said, “are hitting record profits, and we are not going to allow them to undermine our powerful Crypto Agenda that will end up going to China, and other Countries if we don’t get The Clarity Act taken care of.”
He also wrote that the banks are holding the bill “hostage” and that it’s necessary if we want to keep the crypto industry in the US.
On February 10, a meeting was held at the White House where this issue was discussed by representatives of the crypto and banking industries. A statement from the American Bankers Association published just after the meeting said market structure regulations should exist, but they must, “embrace financial innovation without undermining safety and soundness, and without putting the bank deposits that fuel local lending and drive economic activity at risk.”
The Trump Administration had set an informal February 28 deadline to settle the yield debate and put together a bill that can pass. Legislators will soon take their summer break, and when they come back, their attention will be focused on the midterm elections.
One of the Trump family’s business ventures launched its own stablecoin last year, USD1.
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