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More than 125 organizations and companies are pressing Congress to preserve stablecoin rewards, warning that reinterpreting the GENIUS Act would limit consumer choice, weaken competition, and unravel a hard-won regulatory balance.
Industry Coalition Defends Stablecoin Rewards Under GENIUS Act
A coalition of digital asset and fintech groups moved to head off potential limits on stablecoin incentives. The Blockchain Association, a Washington-based trade organization representing crypto and blockchain firms, sent a letter on Dec. 18 warning Congress against proposed efforts to reinterpret the GENIUS Act’s stablecoin reward provisions.
Lindsay Fraser, chief policy officer at Blockchain Association, shared on social media platform X: “125+ organizations and companies are aligned: rolling back lawful stablecoin rewards would take money out of consumers’ pockets, reduce choice, and suppress competition. Congress settled this tradeoff during the GENIUS process—and consumers benefit from the implementation of the law as written.”
The letter, addressed to Senate Banking Committee Chairman Tim Scott and Ranking Member Elizabeth Warren, states:
We, the undersigned organizations and companies, write to oppose efforts to reinterpret and expand the GENIUS Act’s prohibition on interest or yield beyond what Congress enacted.
“Proposals to limit or prohibit rewards or incentives offered by platforms or other third parties in secondary markets would reopen a settled issue, undermine a carefully negotiated compromise, reduce consumer choice, suppress competition, and inject uncertainty into the implementation of a new law before regulations have even been proposed,” the letter continues.
The coalition detailed that Congress deliberately prohibited stablecoin issuers from paying interest while preserving the ability of platforms, intermediaries, and other third parties to design lawful rewards programs. That distinction, the signatories outlined, was intended to mitigate balance-sheet and maturity-transformation concerns associated with issuance while allowing innovation at the application layer. The letter further argues that restricting rewards would unfairly disadvantage stablecoin payments compared with traditional card-based systems, where banks routinely offer incentives despite engaging in lending activities that create greater structural risk.
Signatories included major trade groups and companies such as the Crypto Council for Innovation, the American Fintech Council, the Bitcoin Policy Institute, a16z Crypto, Coinbase, Ripple, Kraken, Gemini, Paxos, Stripe, Paypal, and the Solana Policy Institute, alongside dozens of regional blockchain associations and advocacy organizations.
In its closing arguments, the coalition stressed the consumer and competitive consequences of revisiting the GENIUS framework and highlighted the breadth of industry support behind its position. The letter urges:
We urge Congress to reject any effort—whether in market structure legislation or elsewhere—to limit or prohibit lawful rewards offered by platforms or other third parties consistent with GENIUS.
“Preserving the balance Congress struck is essential to protecting consumers, fostering competition, and ensuring that market structure legislation can advance on a bipartisan and durable basis, rather than becoming a vehicle for entrenching legacy interests at the expense of innovation,” the letter stresses.
The coalition also referenced external research finding no evidence that stablecoin adoption has driven disproportionate deposit outflows from community banks and pointed to the large volume of reserves already held by banks at the Federal Reserve. Supporters maintain that payment stablecoins, offering faster settlement, lower transaction costs, and transparency, can expand consumer choice while operating within the regulatory boundaries Congress has already established.