Top lawyers from Ripple, Coinbase and a16z attended a confidential meeting at the White House this afternoon at 3:00 PM Dutch time. The reason? A stalled crypto law that puts billions of dollars and the future of stablecoins at stake.
Ripple, Coinbase and a16z represent crypto
At 9:00 am local time (3:00 pm in the Netherlands), a private meeting started in Washington between leaders from the crypto sector and representatives of traditional banks. Three heavyweights will join us on behalf of the crypto sector: Stuart Alderoty (legal director of Ripple), Paul Grewal (legal director of Coinbase) and Miles Jennings (legal head at a16z Crypto).
The aim of the meeting is to reach a compromise on a hot topic within US crypto legislation: are stablecoin issuers allowed to pay out the interest on their underlying reserves to consumers?
This issue has been the breaking point in the US Senate for months. Traditional banks are lobbying heavily against these so-called ‘yield-bearing stablecoins’, because they fear that this will undermine their competitive position. According to them, consumers would withdraw their savings from banks en masse if they could earn higher interest on digital dollars elsewhere.
Banks warn of collapsing system
According to the banks, this threatens to create a new financial risk zone. If billions of dollars flow into stablecoins, it could seriously affect banks’ lending capacity. The consequences? Fewer loans, higher interest rates and possible systemic risks.
At the same time, crypto companies warn against the opposite scenario. They believe that banning interest payments stifles innovation and pushes American companies abroad. “Without clear and fair rules we will lose out to offshore parties,” has been said from the sector for some time.
Ripple CEO Brad Garlinghouse previously predicted that the law may be adopted in April this year, provided the consultation leads to concrete agreements.
Source: https://newsbit.nl/ripple-aanwezig-bij-spoedoverleg-in-witte-huis-gaat-dit-de-crypto-wet-redden/
