Crypto Tries to Go Mainstream—And Faces Huge Hurdles

In 2020, you could buy one Bitcoin for less than $10,000. On Friday, you’d have had to pay 10 times as much.

Donald Trump is a fan of crypto, especially digital assets that bear his name and likeness. He wants progress on the bill.

That record high—above $111,000—reflected optimism about a corner of the industry known as stablecoins.

Legislation is working its way through Congress that would provide a framework for the issuance of stablecoins—so-called because they maintain a steady price through a peg to a fiat currency like the dollar, Stacey Marie-Ishmael reported for Bloomberg News.

Donald Trump is a fan of crypto, especially digital assets that bear his name and likeness. He wants progress on the bill.

That’s good for crypto—and the way you express confidence in crypto is by buying Bitcoin. Two firms, Tether and Circle, control most of the existing stablecoin market. Proponents of the bill say it would make it easier for regulators to monitor these assets and safer for companies to accept stablecoins as payment.

But there are hurdles, including a disagreement between smaller banks and crypto firms.

Community banks don’t want competition for deposits, so they’ve opposed a provision that would allow stablecoin issuers to pay interest to holders. That puts them at odds with companies like Coinbase, the only publicly traded U.S. crypto exchange.

Coinbase CEO Brian Armstrong has said that stablecoins “should be able to pay interest just like an ordinary savings account, without the onerous disclosure requirements and tax implications imposed by securities laws.”

Some Democrats, like Senator Elizabeth Warren, are not pleased that the Trump family’s associated crypto project, World Liberty Financial, has a stablecoin of its own.

They are pushing for provisions that would prevent such potential conflicts of interest. World Liberty and the president maintain that no such conflicts exist.