Shirzad emphasized the importance of protecting the GENIUS Act, arguing that rewards benefit consumers without adversely affecting community banks.<\/p>\n
He alleged that the motivation behind banks\u2019 opposition to stablecoin rewards is evident. He claimed that US banks currently generate approximately $176 billion annually from the $3 trillion they hold at the Federal Reserve (Fed) and another $187 billion from card swipe fees, which averages to nearly $1,440 for each household.\u00a0<\/p>\n
This results in over $360 billion yearly from payments and deposits, in addition to substantial unused lending capacity, as the Federal Reserve incentivizes banks to maintain reserves rather than deploy them.<\/p>\n
According to Shirzad, stablecoin rewards pose a challenge to these financial margins\u2014not by impeding banks\u2019 ability to lend, but by introducing real competition in payment systems.\u00a0<\/p>\n
Shirzad further expressed alarm at how, during these Senate discussions, China has recognized the opportunity presented by the bank lobby.\u00a0<\/p>\n
The country has recently announced interest payments to users of its Digital Yuan, aiming to undermine the supremacy of the US dollar. He warned that banning rewards in the Senate would inadvertently aid China\u2019s efforts to challenge the dollar’s dominance.<\/p>\n
Concluding his remarks, Shirzad asserted that the opposition from banks toward stablecoin rewards is not based on prudential concerns but stems from a desire to protect lucrative revenue streams threatened by competition.\u00a0<\/p>\n
Deaton Critiques ABA\u2019s Threat To Stablecoin Rewards<\/h2>\n
John E. Deaton \u2014 attorney for XRP holders in the US Securities and Exchange Commission\u2019s (SEC) lawsuit against Ripple Labs and a former Senate candidate \u2014 also reacted to these developments. He emphasized the importance of the situation as China officially began offering interest on the digital yuan.\u00a0<\/p>\n