JPMorgan executives, led by Umar Farooq and Peter Muriungi, published an official note demanding that yield-bearing stablecoins be banned in the United States. Through this statement, the bank’s digital asset and payment leaders called on Congress to establish a comprehensive regulatory framework that excludes these reward options, arguing significant risks of consumer confusion.
This radical stance seeks to protect traditional financial stability. According to JPMorgan, allowing tokens that offer interest or “cashback” weakens conventional bank deposits and fosters the expansion of “shadow banking”. Although the bank strongly supports asset tokenization for instant payments, it warns that stablecoin rewards raise the risk of bank runs during moments of stress in the crypto market.
The next crucial step will take place in the US Senate, where the controversial Clarity Act will be debated in July. The traditional financial market and the crypto sector remain watchful, especially after firms like Galaxy Research slashed the probabilities of this legislation being approved this year to 50% due to a crowded legislative agenda.
Source: https://goo.su/448pKS
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