US Senator Submits Amendments to Stablecoin Bill
US Senator Jack Reed submitted amendments before the review of the stablecoin bill this Thursday, aiming to explicitly prohibit cryptocurrencies as legal tender, including banning tax payments in crypto assets.
Senator Elizabeth Warren submitted over 40 amendments, one of which aims to prevent the Federal Reserve from issuing master accounts to cryptocurrency companies. Reed and Smith jointly submitted another amendment to include restrictions on bank yields from stablecoins in the bill.
Market Mechanism: Senators, as legislative bodies, submit restrictive amendments, driving expectations for stricter stablecoin regulation, directing funds towards compliant stablecoin issuers and traditional banking systems; restricted crypto companies and high-yield stablecoin products face pressure, while mainstream issuers of USD stablecoins and banks benefit from enhanced competitive barriers.
Source: Public Information
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Jack Reed and Elizabeth Warren have long pushed for strict cryptocurrency regulation in the Senate Banking Committee. This amendment continues Warren's sustained pressure on the systemic risks of stablecoins following the 2022 Libra/Diem incident, having previously blocked stablecoin plans from tech giants like Meta and called for enhanced national security reviews.
In terms of capital flow, the amendment aims to block resources from high-yield crypto-native products to regulated banking channels by prohibiting master accounts, yield restrictions, and legal tender status, motivated by the need to maintain the dollar's credit and the dominance of bank deposits, preventing stablecoins from bypassing traditional financial intermediaries and forming a shadow banking system.
Similar cases include Warren's previous inquiries into Tether and Circle, as well as the EU's MiCA regulations imposing strict requirements on stablecoin yields and reserves; US stablecoin regulation is currently in the final stages of negotiation from frameworks like the GENIUS Act to tightening details.
Structural Judgment: Essentially, this represents capital concentration driven by regulatory changes. Democratic senators are reinforcing the gatekeeping role of the Federal Reserve and banks through amendments, shifting the pricing power and yield distribution of stablecoins from crypto issuers to traditional financial institutions. The mechanism involves legislative restrictions on master accounts and legal tender status, forcing capital from high-risk decentralized paths back into the FDIC-protected banking system, indirectly consolidating dollar hegemony.
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The tighter the regulation, the higher the compliance barriers.
When legal tender is banned, shadow yields die first.
The more amendments by senators, the more concentrated the crypto capital.