The American Bankers Association (ABA) is aggressively lobbying against parts of the Senate Digital Asset Market Clarity Act ahead of a planned banking committee markup on Thursday, warning lawmakers that stablecoin provisions in the updated bill could still undermine bank deposits and weaken financial stability.
In a call to bank CEOs across the country, the ABA over the weekend asked banks and their employees to contact senators immediately to push for tighter restrictions on stablecoins in the crypto market structure bill. The group said the latest version of the legislation — after months of bank lobbying, meetings and input — still leaves room for crypto firms to offer interest-like rewards that could encourage consumers to move money out of traditional bank accounts.
The Senate Banking Committee is expected to release updated legislative text as soon as Monday, with comments and amendments from lawmakers likely to appear Tuesday before Thursday’s committee vote on the Clarity Act.
“We need your help driving this message home before senators consider this legislation,” ABA President Rob Nichols said in the request.
The ABA’s campaign follows a joint letter sent last week with other bank associations that outlined proposed changes to the bill. The groups argued that lawmakers must close what they describe as a loophole surrounding the stablecoin dividend before advancing the legislation.
The dispute has become one of the defining battles in Washington’s cryptopolitical debate. Bank executives and trade groups have argued that yield-bearing stablecoins could act as substitutes for insured deposits and drain funding that banks rely on to provide mortgages, business loans and other forms of credit.
Proponents of stablecoins, including many crypto firms and fintech companies, argue that the products offer consumers faster payments and new ways to move money online. Critics in the crypto industry say banks are trying to maintain their dominance by limiting how digital dollar products compete for users.
“The banking cartel is in full panic mode,” US Senator Bernie Moreno, a Republican from Ohio who has been strongly pro-crypto, wrote on social media X.
The fight delayed previous legislative progress, and lawmakers eventually negotiated a compromise that would ban stablecoin dividends similar to deposit interest while allowing activity-based rewards programs similar to credit card points. Even after these changes, major banking groups have continued to push Congress for stricter protections.
While the White House Council of Economic Advisers had released an analysis of stablecoins that suggested their implementation would not harm the banking system, ABA economists responded with their own study in April. The banking group argued that the administration was focusing on the wrong policy issue by analyzing the effects of banning the stablecoin dividend rather than the consequences of allowing it. According to the ABA, allowing return-bearing stablecoins could rapidly scale the market from around $300 billion today to as much as $2 trillion, increasing pressure on bank funding.
The longer negotiations drag on, lawmakers and industry participants warn, the harder it may be to move comprehensive crypto legislation through the Senate and onto the floor for a final vote. About 10 weeks of Senate floor time remain before the midterm elections, according to the current Senate calendar, and there are many competing interests for the legislative bandwidth.
UPDATE (11 May 2026, 14:55 UTC): Adding response from Senator Bernie Moreno.
