Coinbase CEO Brian Armstrong is opposing efforts to treat stablecoin rewards like bank deposit interest, arguing that USDC is backed one-for-one by reserves rather than created through fractional-reserve lending. In a Sept. 19 Money Rehab interview, Armstrong said Coinbase passes users part of the income generated by short-term U.S. Treasuries backing USDC, which is issued by Circle. Coinbase currently offers USDC rewards ranging from 3.75% to 4.5% through a revenue-sharing arrangement with Circle. The GENIUS Act, signed into law in July 2025, requires stablecoin issuers to maintain at least one-to-one reserves and prohibits issuers from directly paying interest or yield, leaving third-party rewards under debate. Banking groups argue the programs could pull deposits from community banks and are pushing the CLARITY Act to apply stricter rules. The Senate rejected a motion to advance that bill 49-50 on Sept. 15, below the 60 votes required. A White House Council of Economic Advisers analysis estimated that banning stablecoin yield would add about $2.1 billion to bank lending while imposing an $800 million annual welfare cost. Stablecoins lack FDIC insurance and face smart-contract, regulatory and reserve-verification risks, even as fully reserved tokens avoid some risks associated with bank lending.