Core Viewpoint - The refusal to allow stablecoin yield in the U.S. may diminish the attractiveness of the U.S. dollar compared to the Chinese yuan, as China is permitting interest payments on its digital yuan [1]. Group 1: Industry Perspectives - Banks are opposing stablecoin yield to eliminate competition from stablecoin issuers, while China is offering yield, which may influence emerging countries' choices in payment systems [2]. - The American Bankers Association has called for an end to stablecoin rewards, citing concerns that these rewards could lead to a flight of deposits from community banks, negatively impacting their lending capabilities [4]. - The Blockchain Association has countered these claims, stating that evidence does not support the notion that stablecoin rewards threaten community banks or their lending capacity [6]. Group 2: Competitive Landscape - Coinbase CEO Brian Armstrong highlighted that China’s decision to pay interest on its stablecoin provides a competitive advantage and may affect the competitiveness of U.S. stablecoins [4]. - A study by Charles River Associates indicated no evidence of significant deposit outflows from community banks due to stablecoin adoption, suggesting that banks are not genuinely constrained by deposits [6].