Recently, two major organizations in the Crypto Assets industry, the Crypto Council for Innovation and the Blockchain Association, jointly submitted an important document to the Senate Banking Committee. This document clearly expresses opposition to the banking sector's attempt to amend the GENIUS stablecoin bill.

The banking industry has proposed a key amendment, seeking to remove the provision that allows state-chartered institutions' subsidiaries to support stablecoin issuance across state lines. The banking industry believes this could trigger regulatory arbitrage and potentially lead to a loss of up to $6.6 trillion in bank deposits.

However, the crypto industry holds a different view on this. They emphasize in the document that there is no obvious correlation between the popularity of stablecoins and the outflow of bank deposits. In fact, most of the funds held as reserves are still retained within the traditional financial system.

The crypto industry also pointed out that allowing stablecoin users to earn corresponding benefits would help create a fairer competitive environment. This is particularly important for consumers who have long been overlooked by the traditional banking service system.

The crypto industry believes that merely restricting innovation is not the correct way to solve problems. On the contrary, it may hinder the progress and inclusive development of the financial system. They urge regulators to balance innovation and stability when formulating policies, leaving room for the development of emerging financial technologies.

This debate highlights the conflict of interest between traditional financial institutions and the emerging crypto industry. As stablecoins continue to gain influence globally, finding a balance between regulation and innovation will become a major challenge for decision-makers.