Crypto’s Next Chapter Is Being Written by Banks

Congress is still arguing over who gets to write the rules for crypto. Meanwhile, the firms most affected by those rules are already pouring the foundations of the system they expect to operate in.

That’s roughly where American crypto policy sits in July 2026. The CLARITY Act was meant to settle the structure of the US digital asset market. Instead, it has become caught between law enforcement concerns, political disputes and a fight over stablecoin yield.

As banks are developing tokenised deposits, crypto firms are moving closer to regulated financial institutions. Stablecoin issuers are looking for a place inside the system rather than outside it. America’s biggest banks and its largest stablecoin issuer are quietly building competing payment rails for the same money, each betting that whoever owns the customer relationship wins.

Clarity Act faces yet another delay

The Digital Asset Market Clarity Act, known as the CLARITY Act, passed the House back in July 2025 by a wide 294 to 134 margin. The Senate Banking Committee advanced it in May. By early June it was sitting on the Senate calendar, technically eligible for a floor vote.

Then it just sat there. The White House had informally targeted a July 4 signing, and that deadline passed with no ceremony and no vote scheduled. Prediction markets, which had priced the bill’s passage at 82% back in February, have slid to somewhere between 42 and 50%.

Three fights are holding it up.

1. Law enforcement concerns Developer protections may make crypto crime investigations more difficult.
2. Political and ethics disputes Disclosure of over $1 billion in crypto-related income linked to President Trump has complicated negotiations and bipartisan support.
3. Stablecoin rules Disagreement over whether platforms should be allowed to offer yield-like returns.

Republicans control 53 Senate seats. They still need at least seven Democrats to move the bill forward. Neither side has shifted position. The next meaningful deadline is the Senate’s August recess. Missing it reduces the likelihood that the bill will pass this year, since the calendar afterwards fills up fast with other priorities.

The key dispute: stablecoin yield

The most important disagreement is not about whether crypto should be legal. That part is largely settled through the accompanying GENIUS Act in 2025 that bans stablecoin issuers from paying interest directly.

Banks, crypto firms and lawmakers all say they want clearer rules. The concern among banks is that the CLARITY Act may leave enough room for exchanges and platforms to offer rewards that behave like interest without being described that way.

Coinbase currently earns roughly $1.35 billion a year in USDC rewards revenue. The American Bankers Association argues that this creates a pathway for deposits to move out of traditional accounts and into stablecoin wallets offering a return.

Crypto platforms see the matter differently. From their perspective, the restriction protects banks from competition rather than protecting consumers.

As stablecoins begin to resemble an alternative form of cash management, most customers are unlikely to care whether the return is called interest, a reward or an incentive. They care that their money stays liquid while earning something in the background.

That creates a simple commercial battle. Money that would once have remained in a current account can now migrate to a stablecoin wallet. The question is who gets to offer the return that attracts it.

For banks, that is not a minor product issue. It goes directly to the value of the deposit base. In that scenario, there is every reason to move money out of ordinary bank accounts and into stablecoin wallets that pay a return for doing nothing different.

The dispute in one sentence
Banks want blockchain technology without losing deposits.
Crypto firms want deposits to move freely if customers can earn a better return.

Banks are building their own answer

The banks are not waiting for Congress to decide where the boundary should sit.

JPMorgan, Citi, Bank of America, Wells Fargo, and more than a dozen other banks are jointly building a shared Tokenised Deposit Network through The Clearing House. The payments utility the banks themselves own, designed to keep deposits inside the banking system instead of letting them migrate to stablecoins.

It’s targeting a launch in the first half of 2027.

JPMorgan is already further along. Its Kinexys platform has processed institutional blockchain payments since 2020. The bank has also expanded a deposit token onto Base, Coinbase’s public blockchain network.

That is an unusual but telling arrangement. A major bank is using infrastructure linked to one of the largest crypto exchanges while simultaneously trying to defend its own deposit franchise from stablecoin competition.

Citi has taken a similar route, offering real-time settlement services across New York, London and Hong Kong. The technology is becoming less controversial. Control of the customer relationship is the part that remains contested.

Crypto firms adopt traditional finance

The same convergence is taking place from the other side.

Standard Chartered recently became the first globally systematic bank to offer direct USDC minting and redemption for institutional clients. The service was developed with Circle, the company behind USDC.

That is not a small symbolic step. It places a major stablecoin product inside the operating structure of a global bank. The old distinction between banks and crypto firms is therefore becoming less useful. Banks are adopting blockchain-based settlements.

Crypto companies rely on banks for distribution, custody, liquidity and regulatory access. Congress is trying to draw a clean line just as the industry is making that line harder to see.

What the delay is actually costing

The US is not the only market trying to define the rules.

The European Union’s MiCA framework reached full enforcement on July 1, consolidating licensing across all 27 member states. Hong Kong and Singapore have both moved faster than Washington in 2026.

This does not mean the US will permanently lose its position in digital assets. Its capital markets remain too large for that conclusion to be drawn so easily. Every month the CLARITY Act remains stalled allows another jurisdiction the opportunity to pull investment, licensing and talent in its direction. It is a month that licensing activity, and the capital that follows it, has somewhere else to go.

The immediate cost is more practical. Companies tend to launch products, seek licences and allocate capital where the rules are clear enough to plan around.

Each month of delay gives another jurisdiction the chance to become the easier place to operate. Regulatory uncertainty does not stop development and capital flow. It changes where development happens.

Bitcoin’s Next Move Depends on More Than Washington

The legislative debate matters for the long-term structure of the industry. It may matter less for Bitcoin’s price over the next few weeks. Bitcoin has been under pressure for reasons that sit outside the Senate.

• Strategy, the company most closely associated with corporate Bitcoin accumulation, sold about $216 million of the asset in early July. It was the company’s largest sale to date and followed a $12.5 billion writedown alongside growing preferred-dividend obligations.
  
• Spot Bitcoin ETFs had also recorded eight consecutive weeks of net outflows before a partial reversal. Around $510 million returned over three sessions, led by BlackRock’s IBIT.
  
• The Federal Reserve is another immediate factor. Its next meeting is scheduled for July 28 and 29, after holding rates at 3.5% to 3.75% for four consecutive meetings.

For full view of upcoming economic events, check out our Economic calendar.

Changing visibility around Crypto

The most durable shift is already visible. Crypto was once presented as an alternative to banking. Today, it is increasingly becoming part of banking itself.

Banks are adopting blockchain because they do not want to lose deposits. Crypto firms are partnering with banks because they need scale, legitimacy and access to institutional capital. Stablecoins sit between the two, functioning as both a product and a pressure point.

The outcome is unlikely to be a world where crypto replaces banking. It is more likely to be one where banking adopts crypto infrastructure while trying to preserve control over money, customers and yield.

The argument in Washington is therefore less about whether crypto joins the financial system. That process is already underway.

The remaining fight is over who owns the relationship once it gets there.

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