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The White House will meet with top executives from leading cryptocurrency and banking companies on Feb. 2. As per the journalist Eleanor Terrett, the meeting will begin at 1:00 p.m. ET.
The summit takes place after a devastating weekend when all the leading cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), XRP, etc., crashed.
Why crypto and banking industries are clashing
The White House is hosting leaders from crypto and banking industries to reach a consensus over the provision regarding stablecoin rewards in the crypto market structure bill.
Unlike traditionally volatile cryptocurrencies, a stablecoin is a type of cryptocurrency that tries to keep its value stable by being pegged to a fiat currency like the U.S. dollar.
Last year, President Donald Trump signed the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act into law to regulate USD-pegged stablecoins.
The GENIUS Act prohibits stablecoin issuers from offering “any form of interest or yield” but allows crypto exchanges, intermediaries, and other third parties from offering "rewards" or "incentives" to stablecoin holders.
As reported earlier, the banking industry thinks it is a deliberate "loophole" to allow stablecoin holders to gain rewards, if not interest, which could encourage individuals to move their funds from bank deposits to stablecoins.
The banks have been lobbying the Congress to add a provision in the crypto market structure bill that restricts even the third parties from offering any "rewards" on stablecoin holdings.
It's not an unreasonable concern, as Standard Chartered has warned that banks risk losing roughly $500 billion in deposits by the end of 2028 if the stablecoin market grows to approximately $2 trillion.
But the crypto industry argues the banking industry is trying to snatch a level playing field because it fears competition from the burgeoning digital assets industry.
In fact, Coinbase (Nasdaq: COIN) CEO Brian Armstrong even withdrew support from the bill due to the raging controversy.
Who will attend White House meet?
As per a Reuters report, Blockchain Association said it is "proud to participate in next week's meeting."
The crypto trade group represents leading crypto companies such as Coinbase, Ripple, and Kraken.
Though the House of Representatives passed its version of the key legislation in July last year, the Senate is still working on it.
This article has been published in thestreet.com via Yahoo News.
White House meets crypto and banking executives as Bitcoin crashes
The White House will meet with top executives from leading cryptocurrency and banking companies on Feb. 2. As per the journalist Eleanor Terrett, the meeting will begin at 1:00 p.m. ET. The summit takes place after a devastating weekend when all the leading ...
finance.yahoo.com
