How a battle with bankers tarnished crypto's market structure bill near the finish line

Core Insights - The ongoing negotiations regarding a significant regulatory bill for the crypto industry are being heavily influenced by bank lobbyists, which has disrupted the initial expectations of crypto advocates [1][2][3] Group 1: Legislative Developments - The Senate Banking Committee released a draft bill that includes elements favorable to the crypto industry, but it has also made concessions that negatively impact stablecoin rewards [2][7] - The American Bankers Association argues that the competition from stablecoins could lead to a significant disruption in local lending, potentially amounting to trillions of dollars [5] Group 2: Impact of the GENIUS Act - Following the passage of the GENIUS Act, the crypto sector has been advancing its plans for customer rewards programs, although the law restricts issuers from offering yield on stablecoins [4] - Despite the restrictions, third parties and affiliates can still provide rewards, which has raised concerns among bankers about the potential threat to the U.S. banking system [4] Group 3: Lobbying Dynamics - The crypto industry is facing intense pressure from large banks, which are attempting to reshape the regulatory framework to protect their existing business models [3][6] - The new draft bill includes a compromise that prevents stablecoins from offering rewards in a static manner, akin to a savings account, but allows for rewards based on transactional activity [7]