Brad Garlinghouse, Chief Executive Officer, Ripple, USA speaking in the Finding the Right Balance for Crypto session at the World Economic Forum Annual Meeting 2023 in Davos-Klosters, Switzerland, 19 January. Congress Centre - Aspen 2. Copyright: World Economic Forum/Valeriano Di Domenico.Ripple CEO Brad Garlinghouse has renewed the public support for the U.S. CLARITY Act, as political pressure in Washington and the financial sector builds on lawmakers and banks to structure the crypto market.
Garlinghouse responded to a recent White House warning directed at traditional financial institutions, saying that enacting the legislation is all about protecting the American public.
According to Garlinghouse, regulatory certainty is required for the crypto industry and financial institutions. He emphasized that the legislation has always been about aligning the financial system with the interests of the American consumers, noting, “This is, and always has been, about what’s in the best interest of the American people.”
Over the past few weeks, Garlinghouse has repeatedly said that regulatory clarity should be the priority, not protracted negotiations. He has urged industry leaders not to delay the process by demanding perfection, saying clearer rules are better than ongoing regulatory uncertainty.
The Ripple executive also said he has confidence in the legislative timeline. In his opinion, there is an 80% to 90% chance that the CLARITY Act will pass before the end of April 2026.
Lawmakers push negotiations forward
U.S. President Donald Trump urged lawmakers to pass the market structure bill as soon as possible, or they could lose their place in the global digital asset industry. In a post on Truth Social, Trump accused banks of seeking to undercut the GENIUS Act, a stablecoin law introduced the previous year.
The president said financial institutions should not try to “hold the CLARITY Act hostage,” even as banks report record profits.
According to Trump, enacting the legislation would help ensure the crypto industry is anchored in the United States rather than moving activity overseas. He noted, “The Banks are hitting record profits, and we are not going to allow them to undermine our powerful Crypto Agenda that will end up going to China, and other Countries if we don’t get the Clarity Act taken care of.”
Banks and crypto companies clash over stablecoin yield rules
At the heart of the dispute is whether non-traditional banking system companies should be authorized to offer yield on deposits in stablecoins. JPMorgan CEO Jamie Dimon has said that he wants banks and stablecoin platforms to be treated fairly by regulators.
He cautioned that there should be the same oversight of any digital asset service providing interest-like rewards as there is for bank deposits.
Dimon said that stablecoin yield programs are similar to traditional interest payments. As a result, platforms offering such rewards should comply with banking requirements for capital reserves, liquidity, regulatory reporting, and anti-money laundering rules.
Banks have also raised concerns that stablecoin yields will attract deposits away from traditional financial institutions. If exchange and crypto platforms offer good returns, customers can transfer funds from their bank accounts.
