Senator Moreno vows to break the cartel as banks panic over CLARITY Act Stablecoin Yields. 

The CLARITY Act (as of May 2026) aims to ban “passive” stablecoin yield—interest paid simply for holding a balance, which resembles bank savings accounts.

However, it permits “active” rewards, such as incentives for payments, trading or platform usage. The legislation seeks to create a clear distinction between regulated, activity-based incentives and traditional bank interest.

The Digital Asset Market Clarity Act of 2025 (H.R. 3633), often called the CLARITY Act, is a proposed U.S. federal bill aimed at creating a regulatory framework for crypto, primarily regulating digital commodities through the CFTC rather than the SEC. It passed the House in July 2025 and is currently in the Senate.

Bernie Moreno on Monday accused the US banking lobby of full panic mode over CLARITY Act stablecoin yields. He made a post on X highlighting that the American Bankers Association is urging bank CEOs to pressure senators against the provisions.

I started researching the latest developments and had a conversation with an expert in economics and politics.

Senator Moreno & The CLARITY Act

Discussion With An Expert

QUESTION #1. Thanks so much for answering this call. I just read an article on X where Bernie Moreno opposed the banking cartel. I am sure you’ve read that. What do you think about this post?

Moreno’s post? It’s fiery, classic political rhetoric with a populist punch and there’s real economic meat underneath the “break the cartel” slogan.

As an old economist who’s watched banking fights for decades, I see both the legitimate frustration and some oversimplification.

Look, the core complaint rings true.

Traditional banks have had a sweet deal for a long time. They pay depositors peanuts (often near-zero for years, even after rates rose), then turn around and lend it out or invest at much higher spreads. That net interest margin is their bread and butter.

Now stablecoins—especially payment ones backed by solid reserves—could offer real yields, maybe 4-5% or whatever the market and reserves allow, without the same overhead.

Americans holding cash in apps or wallets suddenly getting competitive returns?

That’s straight-up good for consumers and forces competition. Calling deposits “your money in their piggy bank” is colourful but it’s not wrong in spirit. 

The banking lobby’s panic letter from the ABA sounds defensive.

Warning about a “stablecoin loophole” and deposit flight while implying senators are clueless? That’s clumsy lobbying.

They’ve fought innovation before and history shows incumbents hate disruption. The debanking stuff Moreno mentions (Operation Choke Point echoes) is a separate but real governance failure—banks shouldn’t be political enforcers. That erodes trust.

A parenthesis here.

Operation Choke Point was a 2013–2017 Obama-era Department of Justice (DOJ) initiative that pressured banks to cut financial services to legal but high-risk industries, including payday lenders, gun dealers and tobacco companies. It aimed to curb fraud by restricting access to the financial system, though critics viewed it as a political abuse of power.

But here’s where I pump the brakes a bit: It’s not purely a cartel racket. Banks operate under heavy rules such as capital requirements, deposit insurance (FDIC), liquidity coverage ratios, stress tests, etc. Those cost real money and exist because bank runs wrecked the economy before.

Stablecoins, if they scale to trillions and start functioning exactly like demand deposits (instant payments + yield), need comparable guardrails.

A “yield” that’s just interest on reserves isn’t crazy but you don’t want unregulated entities promising bank-like safety without the backstops.

The GENIUS Act debate he references probably hashed some of this out but details matter—reserves must be high-quality, segregation clear, redemptions reliable at par.

The CLARITY Act compromise (barring yields “economically equivalent” to deposits but allowing platform rewards) sounds like they’re trying to thread the needle: encourage innovation without creating shadow banking risks.

Deposit flight can happen fast in a crisis— we’ve seen it with tech banks and money market funds.

The question is whether the bill gets the regulation right.

Moreno’s right to push competition and tell the lobby to take a hike.

Everyday people deserve better options than 0.01% savings accounts while inflation nibbles.

But “break the cartel” framing makes it sound like banks are purely villains and crypto is purely heroes.

Reality is messier—both sides need skin in the game with smart rules. Let stablecoins compete hard but don’t blow up the payment system or create new too-big-to-fail problems.

What do you think— you buying the full “banking elite rigging everything” take, or somewhere in the middle like me? 

Another parenthesis.

The Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), signed into law in July 2025, is the first major US federal legislation creating a comprehensive regulatory framework for stablecoins. It requires 1:1 asset reserves, strengthens anti-money laundering (AML) compliance and allows nonbank issuers to obtain federal licenses, positioning the US to lead in digital assets.

Q #2. Let me reveal some of the comments right on Moreno’s post so we can discover any patterns in public opinion. We started reading the comments.

Good move pulling these comments. Let’s chew on ’em like two old-timers over coffee.

The pattern jumps right out.

Overwhelming anti-big-bank frustration mixed with big optimism about crypto/stablecoins as the disruptor.

Most folks see the ABA letter as proof that the old system is scared and losing ground. Words like cartel, monopoly, panic mode and fuck the banks show up because people are tired of tiny interest on their savings while banks lend it out for fat profits.

That resentment runs deep right now.

You also see the “finally, real competition” vibe — people cheering that everyday Americans might earn actual yields instead of 0.01%.

The guy talking about 20% staking returns highlights why crypto natives are pumped.

There’s this sense of a big shift happening.

Legacy banks had their protected playground for generations and now tech + stablecoins are crashing the party.

A couple of notes in there, too.

The Druid guy is realistic — passing the bill Thursday is one thing but the real war will be in the rulemaking and enforcement later.

That’s classic Washington.

The Old Glory Bank comment is interesting; even some banks want to compete instead of hiding behind the lobby. And the question about whether stablecoins bring in more serious long-term money and cut down on scams? Legitimate point.

More regulated, yield-bearing stablecoins could pull in normies and institutions, which might clean up parts of the market over time, though crypto crime won’t vanish overnight.

Overall, public opinion in these replies is heavily pro-CLARITY Act, pro-innovation and skeptical of the banking establishment. It’s populist energy — “give us our money back and let us choose better options.” You don’t see much defence of the ABA’s systemic risk warnings here. The crowd mostly views that as self-serving talk to protect the racket.

My economist take after decades watching this stuff?

They’re not totally wrong. Competition does force better service and rates — that’s Economics 101. When money market funds or now, stablecoins offer real yields, banks eventually have to respond or lose deposits.

We’ve seen this movie before with brokerage cash sweeps and fintech.

The “piggy bank” complaint Moreno made has truth to it. But here’s the part the cheering section sometimes glosses over.

Not all the bank rules are just cronyism.

Capital requirements and deposit insurance exist because runs and panics have wrecked economies before. If stablecoins grow huge and act exactly like checking accounts (instant payments + yield + feels totally safe), you need clear rules so one bad reserve blowup doesn’t spook the whole system.

The compromise in the bill (no deposit-like yields but alright for real platform rewards) is them trying to split the difference.

Still, the momentum feels real. Polymarket at 73% for the bill becoming law this year tells you the betting crowd agrees with the vibe in these comments.

What stands out to you in these replies, pal? You seeing the same anti-monopoly anger I do or anything else jump out? What’s your next question — you want to dig into the actual economics of stablecoin yields vs bank deposits, the markup on Thursday or something else? Fire away.

Q #3. Thanks so much for this great analysis of comments. Can you share a few words on the “CLARITY Act” in general and what the American government is trying to accomplish? Many argue that all these actions are for the betterment of society. For me, any change that threatens the old guard – the bank cartel and the insanity around deposits and interests… It’s a positive change.

Glad you liked the comment breakdown. Let’s talk about the CLARITY Act straight up, no fancy jargon.

The full name is basically the Digital Asset Market Clarity Act (H.R. 3633). It’s the big US attempt to finally give crypto a proper rulebook instead of the Wild West we’ve had for years.

Think of it as Congress drawing clear lines on who’s in charge (SEC vs CFTC), what counts as a security versus a commodity, how exchanges and brokers should operate and — the hot potato right now — how stablecoins fit in.

What the government is trying to accomplish?

Bring order and legitimacy. Right now, a lot of crypto lives in regulatory grey areas. The bill aims to fix that by giving companies clear paths to register and operate legally in the US. The goal is to keep innovation here instead of pushing it offshore to friendlier (or looser) places.

Protect consumers and fight crime. Stronger rules on custody, disclosures, anti-money laundering, etc. They want everyday people to feel safer putting money in without getting rugged, while making it harder for bad actors to launder cash or finance shady stuff.

Split the regulatory baby. CFTC gets most spot crypto commodities (like Bitcoin), SEC keeps the securities side. Stablecoins get their own special treatment (building on the earlier GENIUS Act that set up issuer rules).

Balance innovation with stability. Especially on stablecoins — the compromise they’re fighting over right now bans passive yields that act too much like bank interest on idle money (to protect the traditional banking system from massive deposit flight). But it still allows rewards for actual activity, like making payments or using the platform. That’s the “no loophole” line Moreno was talking about.

In simple terms, Washington is trying to say…

Crypto isn’t going away. Let’s regulate it smartly so America leads the world in it, attracts investment, keeps the dollar king and doesn’t repeat the blowups we’ve seen in the past.

Your take on threatening the old guard?

I get the appeal, my friend. For decades, big banks had a near-monopoly on everyday money — low rates for you, nice spreads for them, plus heavy regulations that smaller players or new tech couldn’t easily match.

Forcing them to compete with stablecoins that could give regular folks better returns on cash?

That’s healthy creative destruction.

Consumers win when options improve.

That said, from my economist chair, it’s not pure cartel-smashing. Some of the pushback is self-interested, sure. But part of it is real. If stablecoins explode in size and act exactly like checking/savings accounts (instant, safe-feeling, yield-bearing), you want rules so a blowup doesn’t spill over and scare the whole financial system.

We’ve seen bank runs and money market fund panics before. The bill’s trying to thread that needle — let competition happen without creating new shadow banking risks.

Overall, I see it as a net positive if done right.

Clarity usually beats uncertainty for markets and innovation.

Your instinct that shaking up the old deposit game is good?

Spot on for the consumer side. The real test will be in the details and how regulators enforce it later.

What part of this grabs you most — the stablecoin yield fight, the bigger market structure stuff or how it might actually play out for regular people’s money? Your call, buddy.

Q #4. What are your predictions for consumers and business owners after the implementation of this law?

Alright, let’s talk predictions.

Assuming the CLARITY Act passes reasonably intact (Polymarket’s sitting around 73% for this year and momentum looks decent heading into Thursday’s markup), here’s what I see playing out for regular folks and business owners over the next few years.

I’ll keep it real — no hype, just grounded economics from watching these shifts before.

For everyday consumers?

Better returns on cash (with limits).

You’ll likely see more competitive options for your idle money. Stablecoins won’t fully become savings accounts because of the compromise — no straight-up interest just for holding (banks fought hard for that). But expect activity-based rewards — things like cashback for payments, loyalty points or yields tied to using the platform.

Over time, this will pressure traditional banks to raise their own deposit rates. Your 0.01% savings account? That era gets a serious nudge.

Easier, cheaper payments.

Cross-border sends, remittances and even everyday transfers could get faster and cheaper. Stablecoins already do this well. Clearer rules mean more big players jump in safely, bringing better apps and lower fees. Good for travellers, immigrants sending money home or anyone tired of bank wires.

It doesn’t stop here.

More choices and some new risks.

Legitimate platforms will feel safer with proper custody rules, disclosures and consumer protections.

More normies might dip their toes in. But scams won’t disappear — clearer rules help but you still gotta be careful.

Overall, financial freedom increases for people who shop around.

Longer-term?

More institutional money flows in, which can stabilise prices somewhat and bring better products (think integrated banking + crypto apps).

For business owners like you?

Easier fundraising and operations.

The bill draws clearer lines between securities (SEC) and commodities (CFTC), plus pathways for raising capital with digital assets. This reduces legal grey areas that have chilled innovation. Startups and projects can operate with more confidence instead of fearing enforcement actions.

Payments and treasury management.

Huge win here. Businesses can hold, send, and receive stablecoins more reliably for suppliers, payroll (in some cases) or international trade. Lower transaction costs and faster settlement = better cash flow. Importers/exporters especially benefit.

Banking alternatives and competition.

Some owners might shift parts of their cash reserves to yield-bearing (activity-linked) stablecoin setups. This gives leverage against high fees or slow traditional banking. Forward-thinking banks (like the Old Glory example we saw) will adapt and partner up.

Compliance costs.

Not all sunshine — there will be new registration, reporting and anti-money laundering rules. Smaller players might feel the burden more, while bigger firms thrive. DeFi gets some safe harbours, which helps decentralised projects.

Big picture?

This is classic creative destruction. The old deposit monopoly gets cracked open, which is mostly good for consumers and agile businesses.

America gets a shot at leading in digital finance instead of watching it bloom offshore.

Growth in the sector could create jobs and tax revenue.

The risks?

If stablecoins scale massively without perfect guardrails, a blowup could spook people (though the bill tries to mitigate this).

Banks might lose some cheap deposits and tighten lending a bit but history shows they adapt.

Net prediction?

Consumers get more power over their money and better tools. Innovative business owners win big on efficiency and options. Incumbent banks feel pressure but don’t collapse.

It’s positive overall if you’re pro-competition — aligns with your view on shaking up the old guard.

Update: May 24, 2026

There are developments and I discussed them with another American expert.

Q #5. Japan just opened the door wide for foreign stablecoins. What’s your point of view?

Yes, starting June 1, their FSA is letting trusted overseas ones (especially fiat-backed via trusts) operate legally as payment tools — not securities. This should make it way easier for them to flow into Japan and juice up digital finance there.

Smart move to stay competitive.

Kinda contrasts with the US CLARITY Act fight we’re seeing — Japan seems more welcoming to foreign stuff while we’re still hashing out yields and bank protections. 

Epilogue. Thanks so much for this insightful conversation. Really enjoyed it.

It’s been a real pleasure chewing the fat with you on this stuff. I always enjoy diving into these topics with someone who’s clearly thinking it through instead of just cheering one side.

The CLARITY Act (and the bigger crypto regulatory push) is one of those rare moments where Washington actually seems to be catching up to where money and technology are already heading.

Whether it delivers the full consumer-friendly shake-up we both hope for depends on the final details and how it’s enforced but the direction feels healthy.

If anything new pops up after Thursday’s markup or you want to circle back on stablecoins, yields or how it hits real people’s wallets, just hit me up anytime.

Door’s always open. Take care, my friend — talk soon!

A last question to you. 

Are you planning to use stablecoins more in your own life or business once this act lands?

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