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Thanks for tuning in to Coinbeer0's official podcast channel.
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My name is Nick and if you're seeking unbiased,
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in-depth information about Bitcoin,
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cryptocurrencies, Web3, and all manner of related topics,
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then you've come to the right place.
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I hope you enjoy today's episode.
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Banks have launched a secret ad campaign to kill crypto
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and Coinbase is their primary target.
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The independent community bankers of America Group
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is running aggressive ad campaigns,
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labeling Coinbase CEO Brian Armstrong
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as public enemy number one on Wall Street.
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They are urging senators to side with banks
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and ban stablecoin yields entirely.
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But why the sudden aggression?
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Well, according to the bank's own data,
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stablecoins could drain $1.3 trillion
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from community bank deposits and reduce lending
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by $850 billion, which are pretty terrifying numbers.
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But is this actually true or is it a desperate attempt
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to try and protect business models
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that rely on underpaying you for your savings?
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Today we aim to find out.
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My name is Nick and you're watching the Coinbeer0.
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First things first, let's talk about this ad campaign
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because it is nasty.
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Usually, bank lobbying is done quietly.
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It happens at stake dinners in strip clubs
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or on golf courses and behind closed doors in Washington.
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But this time, the independent community bankers
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of America or ICBA has gone scorched earth.
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They've latched onto a narrative
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that frames Brian Armstrong not as an innovator
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but as a threat to the American economy.
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The ICBA represents the small banks, the local lenders,
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the guys who sponsor your little league team.
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But don't let the wholesome image fool you.
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This lot of fighting for their lives
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and they have identified a specific enemy.
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Their campaign is targeting the Senate Bank Committee
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with a very simple strategy.
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If you let crypto companies pay yield on stablecoins,
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you are going to destroy community banking
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and they have the numbers to back it up
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according to a data analysis released by the ICBA
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in December 2025, allowing crypto intermediaries
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to pay interest or yield on stablecoins
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could reduce community bank lending by $850 billion.
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Well, because they estimate it would trigger
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a $1.3 trillion reduction in deposits.
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Now to put this into perspective,
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total community bank deposits
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sit at around $4.8 trillion.
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So they're claiming that stablecoins could wipe out
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more than a quarter of their entire deposit base.
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And logic goes like this.
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If you move your money from a local bank to USDC
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to earn a 5% interest, that money leaves the community.
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It can't be lent out to a local bakery
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or used to fund a mortgage for your neighbor.
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Instead, it sits in a treasury bull back in a stablecoin,
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effectively funding the US government's debt
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rather than your local economy.
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It's a compelling argument, but here's the thing.
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It relies on the assumption that you, the consumer,
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oh, the banks, your deposits,
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regardless of how poorly they treat you.
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And this brings us to the real reason banks are scared.
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It's not just about lending, it's about the spread.
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As of February, 2026,
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the national average savings account yield
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in the United States is a measly 0.39%.
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Meanwhile, Coinbase offers up to 5% on USDC rewards
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for certain customers.
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And through their new on-chain lending integrations,
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yields can hit as high as 10.8%.
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That is a massive gap.
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Banks take your deposit, earn 5% from the Federal Reserve,
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pay you 0.4% and pocket the difference.
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Coinbase and other crypto platforms are essentially saying,
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hey, we will give you the 5%.
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And that is why Brian Armstrong is public enemy number one.
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He's given away the secret source.
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Now, Coinbase isn't just doing this
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out of the goodness of their hearts, of course.
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Stable Coin Revenue is now a massive part of their operations.
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In the third quarter of 2025 alone,
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Coinbase earned $355 million from Stable Coin Revenue.
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Annualize, that is roughly 1.3 to 1.4 billion dollars a year.
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And that is a serious chunk of change.
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And it effectively makes Coinbase a bank in everything but name.
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And the banks actually hate it.
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Now, if you've been following the channel for some time,
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you'll know that this isn't the first time
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that banks have tried to ban competition.
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In fact, this is almost an exact replay of the 1970s.
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Back then, banks had a monopoly on deposits
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thanks to something called a regulation queue,
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which kept the interest rates they could pay.
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When inflation spiked, consumers were losing money
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by keeping it in a bank.
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And it sounds familiar.
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Then came money market funds.
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They offered higher yields and banks screened
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that they would destroy the financial system.
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They lobbied to ban them.
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They said it would kill housing.
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They used the exact same public enemy rhetoric we are seeing today.
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Innovation 1, regulation queue was repealed
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and consumers benefited.
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So the ICBA's campaign is essentially an attempt
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to bring back regulation queue for the digital age.
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But this time, the stakes are higher
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because the legislation that would decide the battle
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is currently on life support.
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And this brings us to the Clarity Act.
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If you've been keeping up with the headlines,
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you'll know that the Digital Asset Market Clarity Act
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was meant to provide clear rules of the road
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for the crypto industry in the US.
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But in mid-January, everything fell apart.
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Coinbase, led by Brian Armstrong,
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pulled their support for the bull
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after the Senate banking committee
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under pressure from the ICBA
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and other banking lobbies in certain language
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that would effectively ban stablecoin yield.
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Armstrong tweeted that, quote,
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no bull is better than a bad bull.
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Coinbase calculated that a ban on yield
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was an existential threat to their business model.
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Remember that billion dollars a year in revenue?
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Yeah, they aren't going to give that up without a fight.
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However, not everyone in crypto agreed with this tactic.
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And the upshot has been a massive split
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On the one side, you have Coinbase
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standing alone refusing to compromise.
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On the other side, you have heavy weights like A16Z
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and Ripple, who will still back the Clarity Act.
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Their perspective is that some regulation
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is better than none,
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and they can fix the yield issue later.
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But for Coinbase, yield isn't a side order of fries.
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It's the main course.
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And by the way, if you want to stay updated
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on this political drama without having
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to doom scroll on X,
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you should check out our free weekly newsletter.
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Our research team breaks down the biggest stories
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in crypto policy and market moves
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so you don't have to.
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It's completely free,
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and it's the best way to stay ahead of the curve.
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And you can sign up using the link in the description
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or by scanning this QR code on your screen.
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But back to the fight in Washington
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where things have escalated quickly.
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The White House realized
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in that crypto legislation was about to implode
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called for an emergency meeting.
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The first meeting happened on the 2nd of February
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and it was attended by the ICBA,
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the American Bankers Association, and crypto trade groups.
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By all accounts, it was a nothing burger.
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The banks thanked the administration
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for the quote constructive conversation
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but gave zero ground.
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And then came the 2nd meeting on the 10th of February.
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And this one was 10th.
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According to reports,
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the banking lobby showed up
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with absolutely no intention to compromise.
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They held the line, ban yield or no deal.
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The crypto side, including Coinbase,
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Ripple and the blockchain association
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reportedly came ready to deal.
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They offered guardrails and consumer protections
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but the banks weren't interested.
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And why would they be?
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They have the public enemy number one narrative
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running in the press
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and they have the Senate banking committee
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terrified of what a supposed $1.3 trillion deposit drain
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And as if to spice things up even further,
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the White House has given both sides a deadline.
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They have until the end of February to reach a deal,
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literally days away.
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Well, it's because of the midterm elections in November.
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If this ball doesn't move now,
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it runs into a buzzsaw of election season.
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And if Republicans lose control of the Senate
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or if the political winds shift,
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we could be looking at years
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before legislation resurfaces.
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We're talking 2027, maybe 2028,
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a lifetime in crypto.
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So what happens if the banks win?
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Well, let's look at some possible scenarios.
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Scenario one, the Clarity Act passes
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with the yield ban included.
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In this world, your 5% yield on USDC vanishes overnight.
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Coinbase and other platforms
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would be forced to stop offering rewards.
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You would be forced back into the 0.39% savings accounts
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or you would have to move your funds off shore
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to risky and regulated platforms just to beat inflation.
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Scenario two, the bull dies entirely.
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And this leaves the US in a regulatory limbo.
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The SEC, which is admittedly much more pro crypto these days,
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would still be largely responsible
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for overseeing the industry.
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If another Gary Gensler-like figure
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replaces the current chair Paul Atkins at any point,
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that could be bad news.
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Meanwhile, banks could continue
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to debank crypto companies
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and the US would continue to lose ground
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to jurisdictions like Europe and the UAE
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who have already figured the stuff out.
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Scenario three, a compromise is reached.
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Maybe they kept the yield
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and maybe they limit it to accredited investors.
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But given the banks' posture
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at the 10th of February meeting,
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this seems increasingly unlikely.
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And this brings us to the uncomfortable truth.
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The banks aren't trying to protect you.
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They're trying to protect their spread.
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They know that if you realize
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that you can hold a digital dollar,
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send it instantly anywhere in the world
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and earn the risk-free rate on it.
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Well, why on earth would you ever need
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a savings account again?
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It's the blockbuster versus Netflix moment for banking
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and blockbuster is currently lobbying Congress
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But before we get to carried away
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bashing the banks, we have to acknowledge one thing.
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That $1.3 trillion number?
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While it is the worst case scenario,
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the logic isn't completely flawed.
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If everyone pulled their money out of community banks tomorrow,
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small business lending would dry up.
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And yes, community banks fund local constructions,
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small businesses and farms,
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while stablecoin issuers just buy US treasury bills.
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So there is a legitimate macroeconomic question here.
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Do you want our capital funding the federal debt
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or do you want it funding local businesses?
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But the answer shouldn't be to ban innovation.
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It should be for banks to compete, offer better rates,
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build better technology,
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don't just run ads calling your competition
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public enemy number one.
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So then, what does all of this mean
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for the future of your money?
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Well, if the bank succeed in this campaign,
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it sets a very dangerous precedent.
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It says that in America,
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you aren't allowed to earn a fair return on your money
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if it threatens the profit margins
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of a politically connected industry.
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It says that the 0.39% you earn on your savings account
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is all you deserve.
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So the next few weeks are critical.
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If the end of February deadline passes without a deal,
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we are likely stuck in the mud
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until the 2026 midterms.
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The stakes then are very clear.
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users will never earn 5% on their digital dollars again.
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And that is a direct attack on your ability
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to earn a fair return.
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The status quo persists and ordinary savers lose out.
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Love crypto or loathe it,
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that doesn't sound like a win for anyone
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but the bankers who will celebrate
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by spending the money that should buy rights
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Now, I wanna hear from you guys.
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Do you believe the banks claim
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that stablecoins are a threat to the economy
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or are they just scared of competition?
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And would you keep your money in a bank
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if you could safely earn 5% on a stablecoin?
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Let me know in the comments down below.
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And if you wanna understand more
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about the specific mechanics of how stablecoins
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actually generate that yield,
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then you can check out our video on that right over here.
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That's all from me today.
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Thank you guys very much for watching
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and I'll see you again soon.
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This is Nick, signing off.
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Hey, it's Nick again with a quick request.
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Please take a moment to rate and review us
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if you have the time.
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It really helps the podcast grow and find new listeners
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and makes us feel all warm and fuzzy inside too.
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Thanks for listening and I'll see you back here again soon.