Trump Backs CLARITY Act in Clash With Banks Over U.S. Stablecoin Yield Rules

U.S. President Donald Trump urged passage of the CLARITY Act and accused traditional banks of undermining the GENIUS Act to protect profits, inserting himself into a regulatory dispute over whether crypto platforms can offer yield on stablecoins, according to a Truth Social post. The GENIUS Act, signed into law in July 2025, created a federal framework for stablecoins while prohibiting issuers from paying interest directly, leaving open whether third-party platforms such as Coinbase can pass on yields; bank lobbying to close this "loophole" in the CLARITY Act prompted Coinbase CEO Brian Armstrong to withdraw support for the bill in January ahead of a Senate markup. Trump's comments drew support from crypto figures including Ripple CEO Brad Garlinghouse and Senator Cynthia Lummis, while critics such as Cardano founder Charles Hoskinson warned the legislation's "security by default" approach could place new projects under SEC jurisdiction and shift future U.S. crypto innovation overseas. Geoff Kendrick, global head of crypto research at Standard Chartered, estimated earlier this year that stablecoins could drain up to $500 billion in bank deposits by 2028, with U.S. regional lenders most exposed.