Rare Evo

Washington's stablecoin standoff just got a whole lot more personal.

Patrick Witt, the executive director of the President's Council of Advisors for Digital Assets, publicly fired back at JPMorgan Chase CEO Jamie Dimon on Tuesday, calling his arguments about stablecoin yields misleading and, in Witt's own word, a "deceit."

The exchange marks one of the sharpest moments yet in a months-long tug-of-war between Wall Street and the White House over the future of digital asset regulation in America.

Dimon Draws a Line in the Sand

It started Monday, when Dimon went on CNBC and didn't mince words. His position was simple, if uncompromising: any platform holding customer balances and paying interest on them is functionally a bank, and should be regulated like one.

"If you do that, the public will pay. It will get bad," Dimon warned, arguing that a two-tiered system where crypto firms operate with fewer restrictions than banks is unsustainable.

Dimon suggested a narrow compromise: platforms could offer rewards tied to transactions. But he drew a clear line at interest-like payments on idle balances, saying, "If you're going to be holding balances and paying interest, that's a bank."

The list of obligations Dimon believes should apply is long, FDIC insurance, capital and liquidity requirements, anti-money laundering controls, transparency standards, community lending mandates, and board governance requirements. "If they want to be a bank, so be it," he said.

For Dimon, it's fundamentally about fairness. JPMorgan uses blockchain in its own operations, and the CEO was careful to frame his argument not as anti-crypto but as pro-competition on equal terms. "We're in favor of competition. But it's got to be fair and balanced," he said.

The White House Fires Back

Witt wasn't going to let that stand. In a post on X late Tuesday, he went directly at Dimon's framing, calling it deliberately misleading.

"The deceit here is that it is not the paying of yield on a balance per se that necessitates bank-like regulations, but rather the lending out or rehypothecation of the dollars that make up the underlying balance," Witt wrote. "The GENIUS Act explicitly forbids stablecoin issuers from doing the latter."

The argument gets at something technically important. What makes a bank risky, and therefore subject to heavy regulation, isn't that it pays interest. It's that banks take deposits and lend them back out, creating credit and the systemic risk that comes with it. If too many people want their money back at once, that's a bank run. Stablecoin issuers operating under the GENIUS Act must maintain reserves at a 1:1 ratio. There is no fractional reserve lending, no rehypothecation, no credit creation.

In Witt's view, stablecoin balances aren't deposits, and treating them as such misrepresents what's actually happening. He closed with a pointed equation: "Stablecoins ≠ Deposits."

President Donald Trump didn't stay quiet either. On Tuesday, he took to Truth Social with a message that made his position unmistakably clear.

"The U.S. needs to get Market Structure done, ASAP. Americans should earn more money on their money. The Banks are hitting record profits, and we are not going to allow them to undermine our powerful Crypto Agenda that will end up going to China, and other Countries if we don't get the Clarity Act taken care of," Trump wrote.

Senator Cynthia Lummis quickly reposted Trump's message, adding her own call to action: "America can't afford to wait. Congress must move quickly to pass the Clarity Act."

The same day Trump posted, a Coinbase delegation led by CEO Brian Armstrong visited the White House for talks. The timing was not subtle.

The Real Stakes: The CLARITY Act

To understand why this debate matters so much right now, you need to understand the legislation being held hostage by it.

The GENIUS Act, signed into law in July 2025, established the first federal framework for payment stablecoins. The CLARITY Act is its sequel: a broader market structure bill that would assign clear regulatory jurisdiction to the SEC and CFTC over the crypto industry, and is widely seen as the piece of legislation needed to unlock large-scale institutional participation in digital assets.

The bill cleared the House comfortably but has been mired in Senate gridlock since January, when the Senate Banking Committee indefinitely postponed a planned markup vote. The trigger was Coinbase withdrawing support over a proposed amendment that would have restricted stablecoin rewards for users.

That withdrawal, announced by CEO Brian Armstrong in a post on X the night before the scheduled committee vote, split the crypto industry. a16z crypto's Chris Dixon publicly disagreed, posting "Now is the time to move the Clarity Act forward." Kraken's co-CEO Arjun Sethi also pushed back, writing that "walking away now would not preserve the status quo in practice" and warning it "would lock in uncertainty and leave American companies operating under ambiguity while the rest of the world moves forward."

The stakes for Coinbase are concrete. Stablecoins contribute nearly 20% of Coinbase's revenue, roughly $355 million in the third quarter of 2025 alone, and most of USDC's growth is occurring on Coinbase's platform. Coinbase currently offers 3.5% yield on USDC, a figure most traditional bank accounts can't come close to matching.

Banks Are Scared, and They Have the Numbers to Show It

The banking lobby's concern isn't hypothetical. Banking trade groups, led by the Bank Policy Institute, have warned that unrestricted stablecoin yield could trigger deposit outflows of up to $6.6 trillion, citing U.S. Treasury Department analysis. Bank of America CEO Brian Moynihan put a similar figure forward, reportedly suggesting as much as $6 trillion in deposits, representing roughly 30-35% of all U.S. commercial bank deposits, could be at risk.

Stablecoins registered $33 trillion in transaction volume in 2025, up 72% year-over-year. Bernstein projects total stablecoin supply will reach approximately $420 billion by the end of 2026, with longer-run forecasts from Citi putting the market at up to $4 trillion by 2030. Those aren't niche numbers anymore. At that scale, deposit competition becomes a serious macroeconomic question.

The American Bankers Association and 52 state bankers' associations explicitly urged Congress to extend the GENIUS Act's yield prohibitions to partners and affiliates of stablecoin issuers, warning of deposit disintermediation.

The Bottom Line

What's playing out right now is a genuine philosophical disagreement about what money is and how it should be regulated, wrapped inside a very consequential legislative fight, a prize fight with Banks in one corner and Crypto in the other.

Dimon's argument is not frivolous. Banks are regulated as heavily as they are because of what they do with deposited money, and a world where consumers move trillions into yield-bearing crypto instruments held at lightly regulated platforms carries real risks. The history of financial crises is largely a history of regulatory arbitrage gone wrong.

But Witt's counter is also not frivolous. The GENIUS Act was designed specifically to prevent stablecoin issuers from doing the things that make banks dangerous. A fully reserved, non-lending stablecoin issuer is structurally different from a fractional reserve bank, and applying the same regulatory framework to both risks conflating two fundamentally different business models.

What's harder to square is that the banking lobby's intervention in the CLARITY Act seems, to many in the crypto world, less about prudential regulation and more about protecting market share. President Trump has not been subtle about that read, accusing banks of holding the CLARITY Act hostage to protect incumbent interests against crypto competition.

With the legislative window narrowing, Armstrong back at the White House, and Trump openly calling out the banking lobby by name, this standoff has reached the kind of inflection point where someone is going to have to blink. The question is whether either side is willing to do it before time runs out entirely.

On February 12, 2026, the U.S. Commodity Futures Trading Commission announced the formation of its new Innovation Advisory Committee, a 35 member group that pulls together executives from crypto, traditional finance, venture capital, academia, and market infrastructure.

It is a notable move. Instead of reacting to innovation after the fact, the CFTC is formally bringing industry leaders into the discussion while rules are still being shaped.

The Innovation Advisory Committee is expected to provide input on how emerging technologies such as blockchain infrastructure, tokenization, prediction markets, and artificial intelligence are changing derivatives markets and trading systems. The CFTC oversees futures, options, and swaps markets, and its jurisdiction already touches crypto derivatives. As digital assets integrate further into broader capital markets, that jurisdiction becomes more relevant.

The committee replaces and expands on a prior CEO level advisory structure. This version is broader, more institutional, and clearly designed to give regulators ongoing exposure to how markets are actually functioning on the ground.

For years, digital asset regulation in the United States has felt fragmented and just trying to catch up with a very fast moving industry. This move suggests the CFTC wants to take a more informed path.

In simple terms, regulators want real world feedback before locking in policy decisions.

Full List of Innovation Advisory Committee Members

Here is the complete list of individuals named to the committee.

Hayden Adams, CEO, Uniswap Labs
Brian Armstrong, CEO, Coinbase
Shayne Coplan, CEO, Polymarket
Brad Garlinghouse, CEO, Ripple
Luke Hoersten, CEO, Bitnomial
Tarek Mansour, CEO, Kalshi
Kris Marszalek, CEO, Crypto.com
Nathan McCauley, CEO, Anchorage Digital
Peter Mintzberg, CEO, Grayscale
Sergey Nazarov, CEO, Chainlink Labs
Arjun Sethi, Co CEO, Kraken
Peter Smith, CEO, Blockchain.com
Tyler Winklevoss, CEO, Gemini
Anatoly Yakovenko, CEO, Solana Labs
Andrej Bolkovic, CEO, Options Clearing Corporation
Thomas Chippas, CEO, Rothera Markets
Professor Harry Crane, Representative
Chris Dixon, General Partner, a16z Crypto
Craig Donohue, CEO, Cboe Global Markets
Terry Duffy, Chair and CEO, CME Group
Tom Farley, CEO, Bullish
Adena Friedman, Chair and CEO, Nasdaq
Christian Genetski, President, FanDuel
Frank LaSalla, President and CEO, Depository Trust and Clearing Corporation
Walt Lukken, CEO, FIA
Scott D. O’Malia, CEO, ISDA
Alana Palmedo, Managing Partner, Paradigm
Vivek Raman, CEO, Etherealize
Professor Carla Reyes, Representative
Jason Robins, CEO, DraftKings
David Schwimmer, CEO, LSEG
Vance Spencer, Co founder, Framework Ventures
Jeff Sprecher, CEO, Intercontinental Exchange
Vlad Tenev, CEO, Robinhood
Don Wilson, CEO, DRW

This blockchain side of the roster includes centralized exchanges, decentralized protocol founders, custody providers, token issuers, and infrastructure builders. It is a who's who of blockchain and a comprehensive cross section of the entire ecosystem. The trad-fi side is just as diverse, representing nealy every aspect of the industry.

What This Signals for U.S. Crypto Policy

First, it reflects a recognition that digital assets are no longer operating in a silo. Crypto markets are tied to derivatives markets, custody infrastructure, clearing systems, and global capital flows. Any serious regulatory framework has to account for those overlaps.

Second, it gives industry leaders a formal channel to weigh in on market structure issues before new rules are finalized. That does not mean the CFTC will simply adopt industry preferences. It does mean discussions are happening in a structured, ongoing way rather than through public disputes or enforcement actions alone, as we have seen in the past.

Third, it may influence how broader legislative efforts evolve. Congress continues to debate how to define digital assets, how to split authority between the CFTC and the SEC, and how to regulate stablecoins and trading platforms. Advisory input from this group could shape technical details that later appear in proposed legislation or rulemakings.

A More Integrated Approach

The presence of executives like Brian Armstrong and Brad Garlinghouse is symbolically important. Both have been vocal about regulatory clarity and jurisdictional boundaries, even pushing back on current wording. Their inclusion suggests the CFTC is still willing to engage directly with major crypto firms and listen to their concerns, rather than keep them at arm’s length.

At the same time, leaders from CME Group, Nasdaq, Intercontinental Exchange, and the Depository Trust and Clearing Corporation bring decades of experience in regulated market infrastructure. That institutional knowledge matters when designing risk controls, margin requirements, reporting standards, and systemic safeguards.

In a way, this committee looks like a snapshot of where finance is headed. Traditional exchanges and decentralized protocols are no longer separate conversations. They are increasingly part of the same system.

Keep in mind that this Innovation Advisory Committee does not create law. It does not replace formal rulemaking. And it does not eliminate enforcement authority.

What it does is formalize dialogue.

By assembling 35 leaders from across crypto and traditional finance, the CFTC is signaling that the next phase of digital asset regulation will likely be shaped through structured proactive engagement rather than reactive policymaking alone.

Whether that leads to clearer rules, better coordination between agencies, or simply more informed debate remains to be seen. But one thing is clear. The regulatory conversation around crypto in the United States just became a lot more interesting.

#Brian Armstrong

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