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White House Economists Say Stablecoin Yield Ban Would Barely Lift Bank Lending

White House Economists Say Stablecoin Yield Ban Would Barely Lift Bank Lending

According to the White House Council of Economic Advisers, banning stablecoin yield would raise bank lending only marginally, as Congress remains deadlocked on the CLARITY Act and broader stablecoin regulation.

Fact Check
The core claim is strongly supported by the White House research page 'Effects of Stablecoin Yield Prohibition on Bank Lending,' which explicitly states that the GENIUS Act requires one-to-one reserves consisting of specified high-quality assets and prohibits issuers from offering interest or yield to stablecoin holders. The same source also gives the model result central to the claim: eliminating stablecoin yield raises bank lending by only $2.1 billion, or 0.02%, and has a net welfare cost of $800 million. 'Stablecoin Yield Ban Impact on Bank Lending | Mirage News' independently reproduces the same executive summary, reinforcing that this is the stated White House/Council of Economic Advisers position. The precise wording 'White House signed the GENIUS Act' is slightly imprecise because presidents sign laws, not the White House institutionally, but the substance of the statement is consistent with the evidence. Search results for 'Text - S.1582 - 119th Congress (2025-2026): GENIUS Act' also align with the law's July 2025 enactment date, though that source could not be fetched here.
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Summary

The White House Council of Economic Advisers said in an April 8 report that banning crypto companies from offering yield on stablecoins would increase overall bank lending by just 0.02%, or about $2.1 billion. The report also estimated community bank lending would rise 0.026%, or about $500 million, indicating only a limited benefit for traditional lenders. The update comes as Congress remains stalled on the CLARITY Act and stablecoin regulation.

Terms & Concepts
  • Stablecoin: A cryptocurrency designed to maintain a stable value, often by being pegged to a fiat currency such as the U.S. dollar.
  • Yield: The return earned on an asset; in crypto, this can include interest-like rewards paid on token holdings.
  • CLARITY Act: A U.S. legislative proposal referenced in the report as part of ongoing congressional debate over crypto market structure and stablecoin regulation.