Scaramucci Slams Stablecoin Yield Ban, Cites Dollar Weakness Risk

He said this decision could make the US dollar less attractive compared to China’s digital yuan, which offers users a return.

The rule is part of the CLARITY Act, a proposal outlining how the crypto market should be regulated in the United States. It stops exchanges and service providers from paying users interest, or “yield", on stablecoins that are tied to the dollar.

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Scaramucci argued that banks pushed for the rule to remove competition from crypto firms. He said, "The whole system is broken".

He added, "The banks do not want the competition from the stablecoin issuers, so they’re blocking the yield. In the meantime, the Chinese are issuing yield".

Similarly, Coinbase $1.32B CEO Brian Armstrong argued that removing yield features could hurt the dollar’s position in global markets by making US-backed stablecoins less appealing than foreign options.

Armstrong said, "I worry we are missing the forest through the trees in the US. Rewards on stablecoins will not change lending one bit, but it does have a big impact on whether US stablecoins are competitive".

On January 18, Armstrong denied claims that the White House plans to stop supporting the CLARITY Act. What did he say? Read the full story.