With the Senate debating the Clarity Act digital asset market structure bill, new polling data shows U.S. small-business professionals say lawmakers should ensure the legislation does not hamper community bank lending in local communities.
“New ICBA polling demonstrates that small businesses understand firsthand the critical role of community banks in supporting local economies and want to ensure the Clarity Act does not harm this vital source of credit,” ICBA President and CEO Rebeca Romero Rainey said. “ICBA continues to urge lawmakers to ensure the Clarity Act includes a robust prohibition on stablecoin yield to ensure community banks continue to power $4.1 trillion in total lending activity in local communities nationwide.”
Views on Digital Assets Policy: The ICBA polling of small-business decision makers conducted by Morning Consult in July found:
- 86% say it is important for policymakers debating crypto policies to ensure digital assets policy avoids harming bank lending in local communities, while 84% say policymakers should avoid harm to the banking system.
- 79% say the current cryptocurrency debate should preserve consumer access to insured deposit accounts, with 77% saying it should sustain consumer access to community banks.
- By a two-to-one margin, small-business decision makers agree that policymakers should prohibit crypto companies from offering interest-like rewards.
Community Bank Favorability: More broadly, small-business decision makers showed continued support for community banks. The ICBA polling found:
- 86% have a favorable impression of community banks, compared with 47% favorability for digital asset and crypto companies.
- 88% say that when deciding where to place money and investments, it is important that the institution is part of the regulated banking system.
- 85% say it is important that banks make lending decisions locally, within the community in which they operate.
- 95% say being able to speak to a human being when they have a question about their bank account or a loan is important to them.
Digital Assets Market Structure Debate: With the Treasury Department estimating opens in a new tabthat stablecoins will grow from $300 billion to trillions of dollars by the end of the decade, research from the Federal Reserve opens in a new tab, New York Fed opens in a new tab, and Kansas City Fed opens in a new tabproject that retail deposits substituting into stablecoins will increase liquidity risk and funding costs, hampering the supply of credit in local communities.
An ICBA data analysis opens in a new tabof industry research estimates that allowing crypto intermediaries to pay interest or yield on payment stablecoins would reduce community bank lending by $850 billion due to a $1.3 trillion reduction in the industry’s deposits—significantly diminishing lending and economic resilience in local communities.
The GENIUS Act took the first step in addressing the risks posed by yield-bearing payment stablecoins by prohibiting issuers from offering yield, interest, or other considerations. ICBA continues calling on policymakers to explicitly extend this prohibition to crypto exchanges, affiliates, and other intermediaries to enable community banks to continue powering local economies across the United States.