U.S. credit unions have aligned with traditional banks in opposing the payment of rewards or interest on stablecoin holdings, reinforcing a growing consensus among regulated financial institutions as lawmakers advance new crypto legislation. The position comes as the latest draft of the Digital Asset Market Clarity Act moves forward in the Senate, explicitly prohibiting digital asset service providers from offering any form of yield that is tied solely to holding payment stablecoins. Credit unions have argued that allowing such rewards could blur the line between stablecoins and deposit products, potentially undermining established banking models. The updated draft reflects months of debate between financial institutions and crypto firms and suggests that lawmakers are prioritizing financial stability concerns while still allowing activity based incentives linked to transactions and usage.
The regulatory development is unfolding against a backdrop of cautious optimism in crypto markets. Major digital assets, including bitcoin and ether, traded modestly higher as traders positioned ahead of key U.S. inflation data that could influence near term market direction. Market participants are closely watching consumer price index figures for signals on monetary policy, with softer inflation expected to strengthen expectations for future interest rate cuts. Analysts have noted that clearer regulatory signals around stablecoins and market structure could act as a catalyst for renewed institutional participation. While trading activity has picked up across major tokens, sentiment remains measured as investors balance regulatory progress against macroeconomic uncertainty.
The proposed framework would formally categorize digital assets into digital commodities, investment contract assets, and permitted payment stablecoins, defining oversight roles for U.S. regulators. Supporters argue that passage of the bill could reduce uncertainty and encourage broader adoption of compliant crypto products, including stablecoin based payment systems. At the same time, disagreement persists between banks, credit unions, and crypto native firms over how restrictive stablecoin rules should be. For now, the rejection of stablecoin rewards by credit unions signals strong resistance from traditional finance to any structure resembling interest bearing digital money. As lawmakers prepare for further debate, markets are weighing whether regulatory clarity and macro conditions can combine to support a stronger recovery across the digital asset sector.
