Trump Calls Out Banks Over Stalled Crypto Legislation
U.S. President Donald Trump has publicly criticized major banking institutions for slowing progress on a key cryptocurrency market structure bill in the U.S. Senate.
Posting on Truth Social, Trump accused banking groups of undermining the GENIUS Act, a landmark bill aimed at regulating stablecoins and strengthening America’s position in the global crypto industry.
“The GENIUS Act is being threatened and undermined by the Banks, and that is unacceptable.”
Trump argued that delaying crypto regulation could allow countries like China to gain a strategic advantage in digital finance.
What Is the GENIUS Act?
The GENIUS Act is designed to create a regulatory pathway for stablecoin issuers operating in the United States.
Key provisions include:
- Legal framework for issuing regulated stablecoins
- Consumer protection and reserve requirements
- Clear compliance rules for crypto companies
However, the bill includes a controversial rule that stablecoin issuers cannot directly offer yield payments to holders.
The Stablecoin Yield Debate
The dispute between banks and crypto companies centers on stablecoin yield payments.
Banks argue that allowing yield-bearing stablecoins could:
- Pull deposits away from traditional bank accounts
- Undermine financial stability
- Create regulatory loopholes
Crypto industry leaders counter that yield mechanisms are essential to DeFi innovation and competitive financial products.
While issuers cannot pay yield directly under the GENIUS Act, third-party platforms such as crypto exchanges could still offer rewards, creating a loophole that banks want closed.
The CLARITY Act: A Competing Approach
The U.S. House of Representatives has already passed its own crypto market structure bill known as the CLARITY Act.
The bill reinforces the concept that stablecoins are:
- Payment instruments, not investment assets
- Not intended to generate interest directly
Representative French Hill suggested the Senate could adopt the House version if negotiations remain stalled.
Coinbase Withdrawal Complicates Negotiations
The debate intensified after Coinbase withdrew support for the Senate bill earlier this year.
The company opposed restrictions tied to stablecoin yield payments, arguing they could restrict innovation and reduce competitiveness for U.S.-based crypto firms.
Since that withdrawal, Senate negotiations have stalled.
White House Meetings Fail to Reach Agreement
Industry leaders and banking representatives have reportedly met three times at the White House this year in an effort to resolve the dispute.
Despite these discussions:
- No compromise language has been finalized
- Senate committee markup has been delayed
- Lobbying from both industries continues
Crypto lobbying groups have already raised over $200 million ahead of the upcoming U.S. midterm elections.
Why This Bill Matters for Crypto
If passed, the legislation would provide long-awaited regulatory clarity for:
- Stablecoin issuers
- Crypto exchanges
- Institutional investors
- Blockchain payment systems
Clear rules could help the United States compete with regions like the European Union, which already implemented the MiCA crypto regulation framework.
Without regulatory certainty, many crypto companies have considered expanding operations overseas.
The Bigger Picture: Banking vs Crypto
The standoff highlights a deeper conflict between traditional finance and emerging digital finance.
Banks worry about losing deposit flows to blockchain-based financial systems.
Crypto firms argue that innovation requires new regulatory frameworks that reflect decentralized technology.
Trump’s public intervention signals that crypto regulation may become a major political issue ahead of upcoming elections.
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That’s where KXZ Store can be useful — it offers digital crypto vouchers and crypto gift card solutions that help users bridge into the crypto world in a simpler, more flexible way. In a market where regulation, banks, and exchanges may shift policies fast, having alternative digital access options can be a real advantage for Web3 users.
Final Thoughts
The battle over U.S. crypto legislation is no longer just a regulatory debate — it has become a political and economic contest over the future of finance.
As the GENIUS Act and CLARITY Act remain stalled, the outcome could shape:
- The global stablecoin market
- U.S. crypto innovation
- Institutional adoption of digital assets
For now, the crypto industry continues to wait for Washington to reach a deal.