Ban on rewards tied to stablecoin payments is un-American: Coinbase

Overview

Coinbase Institute has voiced strong criticism against banking groups that are advocating for regulatory action to prohibit merchant rewards for users of stablecoin payments. The institute argues that this request lacks justification under the GENIUS Act.

What Happened

Recently, banking groups have made a request to regulators to take measures that would prevent merchants from offering rewards to customers who use stablecoins for payments. Coinbase Institute responded to this initiative by asserting that the banking groups’ request is unfounded. They contend that such a prohibition contradicts the principles outlined in the GENIUS Act, which is designed to promote innovation and competition in the financial sector.

Why It Matters

The push by banking groups to limit merchant rewards could have significant implications for the use of stablecoins in commerce. By discouraging the adoption of stablecoins through restrictions on rewards, the banking groups may hinder the growth of a sector that many view as vital to the future of digital finance. Coinbase Institute’s stance emphasizes the importance of maintaining an open and competitive environment for stablecoin transactions.

Impact on the crypto market

• Concerns over regulatory actions may influence merchant adoption of stablecoins.
• Restrictions on rewards could deter consumers from using stablecoins.
• Coinbase Institute’s position highlights ongoing tensions between traditional banking and the crypto sector.
• The debate around the GENIUS Act may shape future discussions on stablecoin regulations.
• The situation underscores the need for clarity in regulatory frameworks concerning digital currencies.

Updated: 11/14/2025, 4:27:07 AM