Scaramucci Says Banning Stablecoin Yields Hurts Dollar Competitiveness

Scaramucci Warns: US Stablecoin Yield Ban Could Cost the Dollar Its Global Edge

Anthony Scaramucci, founder of SkyBridge Capital, has issued a sharp warning about the future of the US dollar in the digital age, arguing that new restrictions on stablecoin yields could weaken America’s position in global finance. According to Scaramucci, the expanded prohibition on yield-bearing stablecoins under the CLARITY Act risks pushing international markets toward alternatives such as China’s digital yuan, which already offers interest to users.

Speaking about the proposed framework for regulating crypto markets in the United States, Scaramucci described the situation as fundamentally flawed. He argued that preventing exchanges and service providers from offering yield on stablecoins does not protect consumers or improve financial stability. Instead, it shields traditional banks from competition at a time when digital currencies are reshaping cross-border payments and monetary influence.

Yield as a Strategic Weapon in Digital Currency Competition

Scaramucci emphasized that yield is not a minor technical feature but a decisive factor in determining which digital currency systems gain adoption globally. While US lawmakers debate how to restrict stablecoin rewards, China has moved in the opposite direction. The People’s Bank of China has already allowed commercial banks to pay interest on digital yuan deposits, effectively turning its central bank digital currency into a yield-bearing instrument.

From Scaramucci’s perspective, the implications are clear. Emerging economies and global market participants are unlikely to choose a payment rail that offers no yield when a competing system does. In a world where capital is increasingly mobile and digital, incentives matter, and yield can tilt the balance of adoption.

Banks, Politics, and the Stablecoin Standoff

At the heart of the controversy lies a broader power struggle between traditional banking institutions and the fast-growing stablecoin sector. Scaramucci accused banks of lobbying against stablecoin yield not because it threatens financial stability, but because it challenges their dominance over deposits and interest income.

He argued that the prohibition reflects political pressure rather than sound economic reasoning. By blocking yield on stablecoins, lawmakers may be preserving the existing banking model in the short term, but at the cost of innovation and competitiveness in the long run.

Coinbase CEO Echoes Concerns Over Dollar Competitiveness

Scaramucci is not alone in his concerns. Brian Armstrong, CEO of Coinbase, has publicly warned that banning rewards on US dollar stablecoins could undermine the dollar’s global role. Armstrong has stressed that offering yield on stablecoins would not materially disrupt bank lending, but it would significantly influence whether US-backed digital assets remain attractive in foreign exchange and international payment markets.

Armstrong has expressed frustration that policymakers may be focusing on narrow regulatory details while overlooking the broader strategic consequences. In his view, failing to allow competitive features such as yield could push users, institutions, and even governments toward non-dollar digital currencies.

The CLARITY Act and the Expansion of the Yield Ban

The CLARITY Act builds upon earlier legislation, including the GENIUS Act, by expanding restrictions on yield-bearing stablecoins. While proponents of the bill argue that it is necessary to safeguard the banking system, critics believe it goes too far by limiting innovation in the stablecoin market.

The expanded scope of the ban has become a central point of contention for crypto industry leaders, who argue that it effectively suppresses competition rather than addressing real systemic risks. As stablecoins become more integrated into global payments and decentralized finance, these restrictions could shape how and where digital dollars are used.

Banking Sector Fears and the $6 Trillion Question

Traditional banks have made no secret of their concerns. During a recent earnings call, Bank of America CEO Brian Moynihan warned that stablecoins could trigger up to $6 trillion in deposit outflows from the banking system. Such a shift, he argued, could reduce banks’ ability to lend and potentially disrupt credit markets.

This warning highlights the core tension behind the debate. Stablecoins offer speed, programmability, and global reach, but they also threaten the deposit-based funding model that underpins modern banking. For critics of the CLARITY Act, protecting that model at the expense of innovation may ultimately harm the US economy.

A Defining Moment for the Digital Dollar

The debate over stablecoin yield is about more than regulation; it is about the future role of the US dollar in a rapidly evolving financial landscape. As countries experiment with central bank digital currencies and blockchain-based payment systems, policy decisions made today could determine which currencies dominate tomorrow’s digital economy.

Scaramucci’s warning serves as a broader call to action. Without competitive features such as yield, US stablecoins risk falling behind at a time when financial influence is increasingly defined by technology rather than tradition. Whether lawmakers adjust course or double down on restrictions may shape the next chapter of global monetary competition.

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