White House Convenes Critical Stablecoin Summit to Resolve Yield and Reward Impasse
The White House Crypto Policy Council convened a high-level summit on February 10, 2026, aimed at breaking a long-standing legislative stalemate over the future of U.S. stablecoin regulation. The closed-door meeting brought together heavyweights from both the traditional banking sector and the digital asset industry, including representatives from JPMorgan, Coinbase, the American Bankers Association (ABA), and the Blockchain Association. This second round of discussions, chaired by Patrick Witt of the President’s Advisory Council on Digital Assets, focused specifically on the “yield vs. rewards” loophole that has derailed the GENIUS Act in the Senate Banking Committee. The core conflict involves a provision that prohibits stablecoin issuers from paying interest to holders—a rule the banking sector wants to view extended to third-party platforms like Coinbase that offer loyalty rewards on digital dollar holdings. The White House has reportedly delivered an ultimatum to both sides, demanding a unified proposal on legislative language by the end of the month to ensure the U.S. maintains its role as the global “crypto capital.”
The Clash Between Banking securety and Crypto Innovation Incentives
The primary roadblock to a compromise remains the fundamental disagreement over how stablecoins should be categorized within the American financial system. Banking associations, including the ICBA and the Bank Policy Institute, argued during the summit that allowing crypto firms to offer “rewards” that mimic interest payments creates an unlevel playing field and poses a systemic risk to local lending. They contend that any asset used as a primary payment tool must be subject to the identical “securety and soundness” standards as traditional deposits, which includes the prohibition on interest-bearing payment accounts. Conversely, crypto advocates like Blockchain Association CEO Summer Mersinger responded that the current “rewards” model is a critical tool for driving innovation and consumer adoption. They warned that overly restrictive language would drive users toward offshore, unregulated platforms, ultimately undermining the President’s goal of preserving the U.S. dollar’s dominance in the digital age. The debate has become a battle over the definition of “money” in 2026, with the banking sector fighting to preserve its monopoly on low-cost liquidity.
Treasury Integration and the Potential Role of National Trust Banks
Amidst the friction over yields, Treasury Secretary Janet Bessent introduced a potential compromise during the session, suggesting that the revised stablecoin definition could explicitly include national trust banks as permitted issuers. This move, supported by recent CFTC revisions to Staff Letter 25-40, would allow certain traditional financial institutions to enter the stablecoin space under a federal “no-action” position. Secretary Bessent emphasized that U.S.-regulated stablecoins are not just a tool for commerce, but a vital future funding source for the federal government that could enhance the liquidity of the Treasury market. While no formal agreement was reached at Tuesday’s meeting, participants described the dialogue as “constructive,” with both banks and crypto firms agreeing to return to their stakeholders with proposed compromise language regarding the “yield loophole.” As the legislative window for the 119th Congress begins to narrow, the pressure from the White House signals that the administration is no longer willing to tolerate a regulatory “no-man’s land” that leaves the dollar’s digital future in a state of perpetual uncertainty.
