The CLARITY Act currently sits in the United States Senate, with a holdup which was created by disagreement over crypto. In particular, the stablecoins. If you have ever tried to explain blockchain to a family member with a plate of food on your lap, you’ll know to just simplify stablecoins as simply digital currencies that are tied to real assets, typically the U.S. dollar.
While the banks want control of crypto’s future, crypto companies are looking for freedom but, the argument about what constitutes stablecoins is becoming more and more focused on ways that would bring about solutions rather than just more arguments.
The issue of whether stablecoin holders should receive interest on their holdings as they do with a bank savings account is was got me to write about this issue. Would you rather earn a higher yield on your stablecoin holdings than go into your local bank to open up a savings account that only earns you an amount in interest after laying around the branches for 6 months? Of course not and the banks understand this.
Banks and crypto firms are butt heads over who gets to issue rewards from exchanges, who is responsible for DeFi (short for Decentralized Finance), and most significantly, which of the many federal agencies around the United States will have the authority to regulate the digital asset industry. As it now stands, every agency is claiming jurisdiction over various aspects of the space, but no single entity has ownership of it yet.
This last aspect of the delay is the most interesting one to me. Both sides believe that crypto should be regulated. There is great disagreement over which party will write the final legislation. The gap between agreement and action is where many issues become stagnant. This can actually keep going one too long and it has a direct impact on whether we'll enjoy a bull run sooner than later.
