Cryptocurrency Market Structure Act Accelerates: Why Have Stablecoin Yields Become the Biggest Policy Dispute?

The distribution of stablecoin yields has become the current major point of disagreement. Centered around this core controversy, representatives from the banking and crypto industries voiced their positions at a White House meeting, with negotiations reaching a deadlock.

Legislative Progress

The regulatory framework for the U.S. crypto market is at a critical juncture. Recently, Senate Agriculture Committee Chairman John Boozman explicitly stated that he is “very confident” that an agreement on the crypto market structure bill can be reached this year.

This bill aims to establish a national regulatory framework for digital assets, primarily overseen by the Commodity Futures Trading Commission to regulate this emerging industry.

The timeline is clear: the final version of the market structure bill could be submitted for presidential signature as early as before Memorial Day. White House advisor Patrick Witt revealed that after the passage of the Genius Act, President Trump personally prioritized this bill.

The legislative process has moved from a phase of principled consensus to drafting specific provisions, with the core goal of ensuring the bill can pass both the Senate and the House of Representatives.

Core Dispute Over Stablecoin Yields

The issue of stablecoin yields is considered the “biggest point of contention” in the current legislative process. The debate mainly centers on whether centralized exchanges should be allowed to pay passive yields on idle stablecoin balances.

At a White House-hosted meeting in early February, representatives from the banking and crypto sectors engaged in a heated discussion lasting over two hours.

Banking representatives strongly opposed stablecoin yield distribution, claiming these yields are “too similar to interest payments,” and that previous legislation had already prohibited similar practices.

Crypto industry representatives argue that such yield distribution is a natural market behavior. Coinbase CEO Brian Armstrong even stated that if the Senate Banking Committee’s draft includes an amendment to “kill stablecoin rewards,” he would be unable to support the bill.

As a key component of the crypto market, stablecoins have maintained relative stability amid recent market volatility. For example, according to Gate data, on February 10, USDC was priced at $1.0000 with a trading volume of $14,745,822,208. On the same day, USDT was priced at $0.999558 with a trading volume of $95,206,121,472.

Positions and Red Lines

There is some basic consensus among all parties regarding stablecoin yields. For example, there is general agreement on banning misleading practices, including promoting stablecoins as FDIC-insured deposits.

In a joint statement after the meeting, the banking groups emphasized: “We must ensure that any legislation supports local lending to families and small businesses, which not only promotes economic growth but also safeguards the safety and soundness of our financial system.”

Crypto industry representatives worry that excessive regulation could stifle innovation. Summer Mersinger, CEO of the Blockchain Association, stated that Monday’s activities marked an “important step toward passing bipartisan-supported legislation for a digital asset market structure.”

The “red lines” in the legislative process are now clear. The current focus of negotiations is on how to balance financial stability with fostering innovation.

The Fundamental Role of DeFi

DeFi (Decentralized Finance) plays a foundational role in the crypto market structure legislation. Patrick McHenry emphasized that without DeFi, the related legislation “simply cannot function.”

He further pointed out that decentralization is the core reason why crypto systems outperform traditional finance in efficiency, transparency, and cost. Tokenized lending products are already significantly cheaper than traditional securities lending.

Ethereum, as the primary platform for DeFi, accounts for 58% of the entire blockchain industry’s deposits on its mainnet. Including Layer 2 networks like Base, Arbitrum, and Optimism, this share exceeds 65%.

Despite recent market fluctuations, Ethereum remains the leader in total value locked (TVL), with its largest decentralized application on the mainnet surpassing $23 billion.

Global Regulatory Environment

The development of the U.S. crypto regulatory framework is not an isolated event but part of a global trend. The EU’s Markets in Crypto-Assets Regulation (MiCA) has already been implemented, setting clear requirements for digital asset service providers operating within the EU.

The French Financial Markets Authority (AMF) reminded that, under MiCA, digital asset service providers previously operating in France must obtain authorization by July 1, 2026, at the latest, or they will be prohibited from continuing services.

Meanwhile, the U.S. Securities and Exchange Commission (SEC) is adjusting its regulatory approach. SEC Commissioner Mark T. Uyeda stated that the SEC has stopped primarily using enforcement actions to express viewpoints and is instead promoting limited pilot programs through regulatory guidance.

He emphasized that SEC rules should remain technology-neutral, focus on outcomes rather than processes, and ensure appropriate investor protections.

Market Impact and Investor Strategies

The advancement of the crypto market structure bill is directly impacting the market. Federal Reserve Board member Christopher Waller recently noted that the optimistic sentiment fueling the market after President Trump’s election may be waning.

With increased regulatory uncertainty, large financial firms are adjusting risk positions for risk management reasons, leading to market sell-offs.

Ethereum derivatives markets reflect investor concerns about further declines. The ETH monthly futures premium relative to spot is about 3%, below the neutral level of 5%, indicating overall lack of optimism among Ethereum traders.

For investors, the current environment requires closer attention to:

• The potential impact of regulatory developments on stablecoin yield models
• Adjustments made by major crypto platforms to comply with new regulations
• Arbitrage opportunities arising from regulatory differences across jurisdictions
• The adaptability of DeFi protocols under the regulatory framework

Summary

Stablecoin prices on Gate show relative market stability. However, the yield distribution models behind these two key stablecoins are becoming a critical point of contention that could determine whether the U.S. crypto market structure bill passes smoothly.

The White House has set clear deadlines for all participants, requiring tangible progress on technical negotiations by the end of this month. The framework for U.S. crypto market regulation is taking shape, and its outcome will have far-reaching implications for the global digital asset market’s development.