Galaxy Analyst Explains Delay in U.S. Crypto Bill Over Stablecoin Yield Disputes

Alex Thorn, head of research at Galaxy Digital, posted on social media analyzing the reasons behind the U.S. Senate Banking Committee's postponement of the markup session for the cryptocurrency market structure bill. According to Thorn's analysis, while the parties involved have largely reached consensus on core market structure issues, there remain "narrow but deep" disagreements on key issues such as stablecoin yield. Thorn noted that banking industry lobbying groups are actively pushing for restrictions on stablecoin yields, fearing that interest-bearing stablecoins could divert deposits from banks. A draft of the bill discussion had proposed a compromise allowing "activity-based rewards," but Democrats and some Republicans still insisted on stricter limitations, ultimately making the stablecoin industry unable to accept the proposal. Other unresolved issues include provisions related to DeFi and illegal activities, as well as restrictions on the SEC's promotion of innovation in tokenized securities. Although the postponement gives all parties more time to reconsider, Thorn emphasized the urgency of the situation, stating that incorporating market structure into federal law is crucial for the long-term development of the industry.