Bitcoin Magazine
TD Cowen Gives Stablecoin Yield Ban 10% Odds as Banks Plan Push in Democrat-Led Congress
Banks will try again to stop crypto platforms from paying yield on stablecoin balances, but TD Cowen’s Washington analyst Jaret Seiberg puts only a 10% chance on Congress enacting such a ban over the next two years, he wrote in a Monday policy note shared with Bitcoin Magazine and clients.
The issue is whether exchanges and other platforms can offer yield or rewards to investors who keep dollar-pegged stablecoins on their platforms. Seiberg views action as unlikely, though he sees a “narrow path” for a ban.
His rationale is procedural as much as political: it may be easier to find 60 Senate votes on stablecoin yield alone than on the broader crypto market structure bill, which failed a cloture vote 49-50 on Sept. 15 and which he already called effectively dead for this Congress after the Democratic midterm sweep.
A ban, he wrote, would benefit banks. He expects them to renew the push in the next Congress on the theory that Democratic wins open a path.
That path rests on a shift in the Senate. Key crypto advocates retired or lost, while skeptics are being elevated. Sen. Elizabeth Warren is likely to chair the Banking Committee, and Sen. Sherrod Brown, a longtime critic of the industry, regained his Ohio seat after crypto-backed spending of about $64 million failed to stop him, Seiberg wrote before the votes were counted.
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