Galaxy CEO: The Real Friction Point of the Crypto Market Structure Bill Lies with the Banks

Jinse Finance reported that Galaxy CEO Michael Novogratz pointed out the reasons for the slow progress of the cryptocurrency market structure bill. He said that both parties want to pass this bill, which in itself is not a problem. The real friction point lies with the banks—especially regarding stablecoins. Currently, large banks pay depositors almost zero interest (about 1-11 basis points), while deposits placed at the Federal Reserve can earn a yield of 3.5-4%. The emergence of stablecoins threatens this interest rate spread. If consumers can earn yields elsewhere, deposits will shift—and banks’ profits will decrease. That’s why this is such an intense lobbying battle. If stablecoins are allowed to compete, banks will either lose deposits or have to pay consumers more. This is the trade-off that legislators are working hard to balance. So yes, it is indeed a contest between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). But ultimately, it’s about who can control the economic benefits of your funds. That’s why this bill is harder to pass than it appears.