Group 1 - The US banking industry is advocating for a prohibition on companies paying interest on stablecoin balances, which is causing delays in the legislative process for the Clarity Act in Congress [1][2][4] - A meeting hosted by the White House's crypto council included representatives from major banks and crypto trade associations, highlighting the industry's unified stance against interest payments on stablecoins [3] - The document shared among banks emphasizes limited exemptions to the prohibition and warns that allowing interest payments could lead to deposit flight, negatively impacting local lending [6][7] Group 2 - The American Bankers Association and other banking organizations issued a joint statement advocating for policies that support financial innovation while ensuring the safety of bank deposits [8]

Federal Reserve Governor Christopher Waller floated the idea of the central bank creating a "skinny master account" for crypto firms which would grant them access to the Fed's payment rails while keeping them away from a full Fed master account. You’re reading State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government. Click here to sign up for future editions. Payment rails The narrative Federal Reserve Governor Christopher Waller suggested this week that crypt ...