JPMorgan Chase CEO Jamie Dimon criticized the Clarity Act, saying the current version gives crypto companies advantages that traditional banks don't have. The controversy centers on stablecoin yields, compliance requirements, and regulatory boundaries.

Stablecoin yields become a point of contention

Dimon stated that his biggest concerns are about stablecoins and whether crypto companies can offer rewards or returns on customer balances. He believes that all institutions providing similar banking account services should adhere to the same rules.

Banking groups are also pushing for stricter terms. They worry that the current version could allow crypto companies to offer products that are close to those offered by banks without adhering to banking standards.

Banks are worried about deposit outflows

Banks are also concerned that stablecoins will divert traditional bank deposits and impact lending activities. Dimon also criticized Coinbase CEO Brian Armstrong for supporting the bill.

Coinbase stated that stablecoin rewards benefit users and drive growth in its US crypto business. The controversy intensified after Coinbase launched a yield product for USDC.

The bill is still progressing

The CLARITY Act is still progressing in Congress, with support from the White House and pro-crypto lawmakers. Banking groups, however, continue to demand stricter banking and compliance provisions.

The Senate is expected to vote on the amendments in the coming weeks, and lawmakers are also discussing them ahead of the vote.