Eight U.S. banking groups urged Senate leaders John Thune and Chuck Schumer to strengthen the CLARITY Act’s limits on stablecoin rewards, arguing that interest-like incentives could draw deposits from banks and curb lending capacity. The coalition, which includes the Bank Policy Institute, American Bankers Association, Consumer Bankers Association, Financial Services Forum and Independent Community Bankers of America, said community banks and deposit-funded lenders would be particularly exposed. The groups also criticized the bill’s proposed deposit-flight circuit breaker, saying it would activate only after substantial outflows and therefore would not prevent harm. They asked lawmakers to prohibit all direct and indirect interest or returns on stablecoin holdings and bar incentives that are economically similar to bank deposit rates.