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TechFlow, August 13 — According to Cointelegraph, several banking industry groups including the Bank Policy Institute (BPI) have warned Congress to close a regulatory loophole in the GENIUS Act that allows stablecoin issuers to offer yield to holders through affiliated companies. The banking groups stated this could lead to as much as $6.6 trillion in deposits flowing out of traditional banks, affecting credit availability and increasing borrowing costs.
According to Cointelegraph, several banking groups, including the Bank Policy Institute (BPI), have warned Congress to close a regulatory loophole in the GENIUS Act regarding stablecoin yields. The loophole allows stablecoin issuers to offer returns to holders through affiliated companies. The banking groups said this could lead to as much as $6.6 trillion in deposits flowing out of the traditional banking system, affecting credit supply and increasing borrowing costs.
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