TLDR:
- The White House set a March 1 deadline to advance the Crypto Market Structure Bill.
- Draft text prohibits firms from offering yield on idle stablecoin balances.
- SEC, Treasury, and CFTC would enforce violations with fines up to $500,000 daily.
- Broader reforms address custody, exchange oversight, and token classification rules.
The Crypto Market Structure Bill is moving toward a March 1 deadline after direct engagement from the White House.
A draft framework presented this week narrows the debate around stablecoin yield models. The central decision removes yield on idle stablecoin balances.
Federal agencies would oversee enforcement under the proposed language. Industry firms, trade groups, and banking representatives attended the meeting as negotiations entered a decisive phase.
White House Pushes Stablecoin Yield Restrictions
The White House led the recent meeting and introduced draft legislative text. Bull Theory highlighted this development on X, noting that the administration set a March 1 deadline.
The tweet stated that no yield would be allowed on idle stablecoin balances. It also noted that discussions were tightly managed by federal officials.
The draft language bars firms from offering rewards for simply holding stablecoins. The savings account -styleyield structure is therefore excluded.
Lawmakers are now debating whether rewards tied to structured activities could remain permissible. Lending or defined network participation models remain under discussion.
Enforcement authority would rest with the SEC, Treasury, and CFTC. The draft outlines penalties of up to $500,000 per violation per day.
Regulators would coordinate to ensure compliance across issuers and intermediaries. This framework aims to standardize oversight across federal agencies.
Banks continue pressing for a deposit outflow study. They seek clarity on whether payment stablecoins could reduce traditional bank deposits.
National banking associations participated in the meeting. Their focus remains on preserving stability within the existing deposit system.
Broader Framework Targets Regulatory Clarity
Beyond stablecoin yield limits, the Crypto Market Structure Bill addresses wider regulatory coordination. The proposal seeks clearer custody standards for digital asset firms.
Exchange oversight would also receive defined supervisory boundaries. Token classification rules are central to the draft.
The division of authority between the SEC and CFTC is a key feature. The framework would clarify which tokens fall under securities or commodities law.
This delineation has remained contested in recent years. A formal structure could reduce conflicting interpretations.
Industry participants included Coinbase, Ripple, a16z, and several trade groups. Their presence indicates continued engagement despite policy constraints.
Talks are ongoing and may continue through the end of the month. Lawmakers appear focused on reaching an agreement before the deadline.
Market participants view a formal framework as a step toward reduced uncertainty. Clear rules around permissible activities may encourage broader institutional participation.
While certain yield models face restrictions, other business models remain viable. After March 1, the bill would advance to its next legislative stage.