Catenaa, Thursday, March 05, 2026- Executive director of the President’s Council of Advisors for Digital Assets Patrick Witt today pushed back against JPMorgan CEO Jamie Dimon’s assertion that stablecoin platforms paying yield should be regulated like banks.
Earlier JPMorgan CEO Jamie Dimon warned that crypto firms offering stablecoin yields must face bank-like regulations to prevent economic instability. This dispute over rewards programs has stalled a key crypto market structure bill, as White House-mediated talks between banking leaders and firms like Coinbase have so far failed to reach a compromise.
Dimon argued that offering interest-like rewards on stablecoins is equivalent to holding deposits, which under banking law triggers capital, insurance, and anti-money-laundering requirements.
Witt countered on X, saying Dimon misrepresents the situation.
He emphasized that the GENIUS Act, enacted in July 2025, explicitly forbids stablecoin issuers from lending or rehypothecating the underlying dollars, meaning that paying yield alone does not constitute bank activity.
He added that stablecoin balances should not be treated as traditional bank deposits.
The debate has delayed broader crypto market legislation, including the CLARITY Act, as banks and crypto firms negotiate over yield structures.
Banks fear that stablecoin rewards could divert deposits, while crypto proponents argue regulated stablecoins expand consumer options.
Dimon suggested a compromise that allows rewards on transactions rather than holdings, a proposal also reflected in a Senate Banking Committee draft.
This approach led Coinbase to withdraw its support from the broader market structure bill.
Recent White House meetings with banking and crypto executives have aimed at finding a middle ground, though no agreement has yet emerged.
Patrick Witt says stablecoin yields alone do not require bank-like regulation, emphasizing that lending restrictions under the GENIUS Act differentiate them from deposits.
