A coalition of crypto industry advocates is pushing back against Wall Street banks’ calls to prohibit stablecoin yields. The coalition argued that user involvement, innovation, and liquidity across digital asset markets depend on limited incentives.
A White House conference between Wall Street bankers and cryptocurrency entrepreneurs stalled this week, even though government officials under President Donald Trump urged the parties to reach an agreement. In a one-page document titled “Yield and Interest Prohibition Principles,” the banks defended their stance that no stablecoin yield or incentive is appropriate. They claimed that such yields jeopardize the depository activity at the core of the American banking system.
Digital Chamber outlines principles to protect stablecoins
Today, The Digital Chamber is releasing principles to help illuminate the path forward on the stablecoin yield debate so that the U.S. can move forward in advancing a durable market structure bill and lead the world in crypto.
These principles push to preserve stablecoins as… pic.twitter.com/CKMgT9k7Xv
— The Digital Chamber (@DigitalChamber) February 13, 2026
Among the most prominent voices, the Digital Chamber has put forth a formal principles framework to guide policymakers toward fair regulations that uphold the US dollar’s global dominance, support DeFi expansion, and safeguard stablecoins’ position in payments.
On February 13, the Digital Chamber published a report stating that Section 404 of the Senate Banking Committee’s market-structure draft would prohibit interest or compensation for merely holding payment stablecoins, although defining specific allowed applications. The group cautioned that eliminating key exemptions would cause current digital asset activities linked to dollar-denominated stablecoins to stop.
The Digital Chamber explained that the Act may seriously impair these markets in the absence of specific clauses that permit incentives for tasks such as liquidity provision in DeFi protocols and exchange liquidity pools. According to the organization, this reduces the risk that dollar-based stablecoins will lose their global significance and may allow foreign currencies to take their place in crucial sectors of the digital asset ecosystem.
According to the crypto advocacy group, no organization should avoid a direct or indirect ban on stablecoin yield as long as the applicable exemptions are maintained. The chamber also agreed with financial institutions’ concerns regarding community banking and lending. It also stated that businesses must accurately disclose that any profits derived from stablecoins are not comparable to conventional interest income.
The Digital Chamber favored keeping clauses that linked such exemptions to compliance controls and explicit statements. According to its principles, these actions are meant to mitigate enforcement risks while preserving openness for users engaged in stablecoin-related activity.
The chamber also supported a clause in the Senate Banking Committee draft that requires authorities to conduct a study evaluating the advantages of expanded payment-stablecoin activity and its impact on deposits at insured banks, two years after implementation. According to the group, such analysis should demonstrate that stablecoins enhance the established financial system rather than replace it.
Carbone pushes compromise amid stablecoin negotiation stalemate
Digital Chamber CEO Cody Carbone said in an interview that the group sees their plan as a compromise meant to show lawmakers that it is flexible. He emphasized that the industry organization is prepared to make concessions on provisions that resemble interest payments, as passive stablecoin holdings most closely resemble traditional savings accounts.
Carbone said that banks are working to amend upcoming legislation to limit provisions that are now permitted under the GENIUS Act, which is the stablecoin’s governing law. He urged bankers to resume talks, arguing that while the industry’s willingness to remove incentives for passive holdings is a major concession, businesses should still be able to provide transaction-tied incentives.
“If they don’t negotiate, then the status quo is that just rewards continue as-is. If they do nothing and they continue to say, ‘We just want a blanket prohibition,’ this goes nowhere.”
-Cody Carbone, Digital Chamber CEO.
Carbone expects that the new position paper from the Digital Chamber would help restart the negotiations that have stalled the legislation’s advancement since an 11th-hour dispute ruined a hearing on the bill before the banking panel a month ago. The White House has reportedly called for a compromise by the end of the month. Although Trump’s crypto adviser Patrick Witt stated in a Friday interview with Yahoo Finance that another meeting would be scheduled for next week, the bank side hasn’t appeared to move much in talks thus far.
