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White House criticizes JPMorgan stance on stablecoin yields
A senior White House advisor on digital assets has criticized recent remarks by JPMorgan CEO Jamie Dimon regarding yield payments on stablecoins. The dispute highlights growing tensions between the banking sector and the crypto industry over how stablecoins should be regulated.
Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets, responded to Dimon’s statement that platforms offering yield on stablecoins should be regulated in the same way as banks. Earlier this week, Dimon said in an interview with CNBC that paying interest on stablecoin balances effectively makes a platform operate like a bank. According to him, institutions that hold customer funds and pay interest should follow the same regulatory rules as traditional banks.
He emphasized that banks must comply with strict requirements, including FDIC deposit insurance, anti-money laundering rules, and capital standards. Therefore, stablecoin issuers offering similar reward structures should face comparable oversight. Patrick Witt disagreed with that interpretation. In a post on X, he said the argument misrepresents the issue and is misleading.
The key difference lies in how funds are used
According to Witt, the main issue is not the payment of yield itself but how the underlying funds backing stablecoins are used. Bank-like regulation becomes necessary when institutions lend out or rehypothecate customer deposits in financial operations.However, the GENIUS Act, adopted in 2025 to regulate payment stablecoins, explicitly prohibits issuers from engaging in such practices. As a result, Witt argues that stablecoin balances should not be treated the same as bank deposits.
Debate over stablecoin yields slows crypto legislation
The dispute has become one of the factors delaying broader crypto market structure legislation, including the CLARITY Act. Negotiations between banks and crypto companies have remained difficult even after the GENIUS Act established a federal framework for payment stablecoins in July 2025.Banks fear that yield-bearing stablecoins could draw a significant share of deposits away from traditional banking institutions. Meanwhile, crypto industry advocates argue that properly regulated stablecoins could expand financial opportunities for both consumers and banks.
No compromise reached yet
Jamie Dimon has suggested a potential compromise that would allow rewards tied to transactions rather than simply holding stablecoins. A similar idea also appeared in a draft market structure bill prepared by the Senate Banking Committee. However, the proposal also sparked controversy. Coinbase withdrew its support for the legislation after the provision appeared in the draft.In recent weeks, the White House has been holding closed-door meetings with executives from both crypto companies and major banks in an attempt to find a compromise. While participants described the discussions as productive, no final agreement has been reached so far.
Earlier, we reported that the White House is seeking to limit stablecoin yields, while the relevant bill has stalled in the Senate.
This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.
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