Donald Trump Blasts Banks, Urges CLARITY Act Passage

The CEO of Ripple, Brad Garlinghouse, supported the words of President Trump, saying that they are in line with the public interest.

US President Donald Trump accused the mainstream banking group of undermining the GENIUS Act and holding the CLARITY Act “hostage” to protect their profits, directly injecting themselves into the legal battle over stablecoin yields.

The intervention represents a significant increase in the fight over whether crypto platforms can offer interest-like rewards on stablecoins, a practice banks argue will cause massive outflows from traditional deposit accounts.

Trump Hits Back at Banks for Stablecoin Standoff

In a Truth Social post, Trump framed the controversy as an existential threat to American innovation.

“The Genius Act is being threatened and undermined by the banks, and that is unacceptable – we will not allow it,” he wrote. “US needs to do Market Structure, ASAP. Americans should get more bang for their buck.”

The GENIUS Act, signed into law in July 2025, created the first government framework for stablecoins but prohibited issuers from paying interest directly to owners. It left an important question unanswered: whether or not third-party platforms like Coinbase can transfer the yield to customers.

Banks have since lobbied hard to close this “loophole” in the CLARITY Act, a comprehensive market structure bill that would establish a clear mandate for digital assets.

Their stance led to disagreements with other players in the crypto industry, which reached a boiling point in January when Coinbase CEO Brian Armstrong withdrew support for the bill ahead of a scheduled Senate markup, citing proposed amendments that would ban passive yields on stablecoins.

The White House set a March 1 deadline for stakeholders to resolve their differences, however no public consensus had emerged by that date.

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“Banks should not try to violate the Genius Act or hold back the Clarity Act,” Trump said. “They need to make a good deal with the Crypto Industry because that’s what the American people are most interested in.”

Earlier this year, Geoff Kendrick, global head of crypto research at Standard Chartered, warned that stablecoins could draw as much as $500 billion from banks by 2028, with US regional lenders heavily exposed.

Industries Rejoice While Banks Face Cartel Charge

Trump’s words were immediately praised by crypto leaders, with Ripple CEO Brad Garlinghouse calling it “a very clear message… about what’s good for the American people.”

Senator Cynthia Lummis has had enough of the urgency, she urged Congress to quickly pass this act. Meanwhile, Eric Trump, the president’s son and the founder of World Liberty Financial, accused the big banks of “severe panic” for losing the “digital financial race.”

However, others, such as Charles Hoskinson, slammed the law, with Cardano’s founder describing it as “a terrible, trashy bill,” and warning that its “default security” framework will hold new projects under the SEC’s jurisdiction and “destroy all future American cryptocurrency projects.”

He argued that while legacy tokens like Cardano may be released, future innovations will be forced overseas. This puts him at odds with Garlinghouse, who pointed out that “clarity trumps chaos” and that the industry cannot allow “perfection to be the enemy of progress.”