02-24-2026 
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Digital asset market structure legislation talks in the United States are (allegedly) moving closer to a stablecoin consensus, while America’s regulators are removing ‘friction points’ limiting Wall Street’s embrace of the dollar-backed tokens.
- Market structure stablecoin talks going, er, great?
- SEC loosens broker-dealers’ stablecoin rules
- USD1 briefly depegs following ‘coordinated attack’
- Pause sought on crypto bank charter applications
- CZ teases Binance.US expansion plans
We’ll start with the obligatory market structure legislative update, following last week’s meeting at the White House between bankers and their crypto counterparts. The meeting, the third of its kind in as many weeks, was intended to help these stakeholders resolve their differences on the great stablecoin ‘yield v reward’ debate.
Once again, with feeling: crypto platforms like Coinbase (NASDAQ: COIN) want to continue offering ‘rewards’ to users who hold stablecoins on their platforms. Bankers want these platforms to be subject to the GENIUS Act’s prohibition on stablecoin issuers offering ‘yield’ to token-holders. The banks say they fear mass deposit flight as their customers seek higher returns. Crypto operators say the banks just don’t want to compete for those customers.
The day after last week’s meeting, White House crypto advisor Patrick Witt tweeted that the parties had made “a big step forward” in resolving this impasse. The White House previously set a March 1 deadline for the two sides to commit to a mutually acceptable way forward, and Witt said, “Provided we continue to have good faith engagement from both sides on this issue, I fully expect we will meet our deadline.”
The most recent draft of the Senate Banking Committee’s CLARITY Act would have permitted crypto platforms to offer rewards for certain stablecoin ‘activities’ but the parameters of said activities proved a sticking point.
On February 19, Crypto in America journo Eleanor Terrett tweeted that Witt basically agreed that crypto platforms should no longer be able to offer rewards for passively holding stablecoins. But while some activity-based rewards appear likely to be okayed, the precise scope of said activities remains unresolved.
Regardless, on Monday, Crypto in America quoted Witt saying the two sides’ separation on this front had “shrunk considerably.” Assuming the parties can work out a compromise, “it’s going to start a domino effect here, and I think things could move pretty fast once it’s resolved.”
CLARITY has been in limbo ever since mid-January, following Coinbase’s abrupt withdrawal of support the night before the Banking Committee was scheduled to markup the legislation. There’s a palpable sense of urgency to restart this process, as the legislative clock is ticking ahead of November’s midterm elections.
Once CLARITY has been approved by a majority of Banking’s members, it needs to be reconciled with the companion bill advanced last month by the Senate Agriculture Committee. Only then can it proceed to the Senate floor for a vote. And with a limited calendar and an ever-growing number of more pressing concerns (Iran, tariffs, Jeffrey Epstein, etc.), fears are mounting that this ship might run aground before it reaches its final port of call.
Witt has reiterated how important market structure passage is to President Trump, whose family has extensive involvement in crypto ventures. And yet, as of Monday evening, Polymarket ‘predictors’ believe there’s only a 25% chance of Trump mentioning either ‘bitcoin’ or ‘crypto’ during Tuesday’s State of the Union address to Congress. For what it’s worth, that’s two points below those who believe he’ll say ‘UFC’ but five points higher than ‘steroid.’
SEC cool with not planning for stablecoin demise
On February 19, Hester Peirce, a U.S. Securities and Exchange Commission (SEC) commissioner, announced that the SEC’s Division of Trading and Markets had revised its broker-dealer net capital rule (Exchange Act Rule 15c3-1) to loosen restrictions on how broker-dealers treat the stablecoins in their possession.
Specifically, broker-dealers that previously set aside 100% of the market value of the stablecoins they held as capital (in case of issuer insolvency) can now set aside just 2% as a possible ‘haircut’ on their value. In effect, the revised rule now treats ‘payment stablecoins’ as having the same kind of ‘ready market’ enjoyed by money-market funds.
Peirce said she ‘appreciates’ the division’s new guidelines, claiming that stablecoins “are essential to transacting on blockchain rails. Using stablecoins will make it feasible for broker-dealers to engage in a broader range of business activities relating to tokenized securities and other crypto assets.”
The new guidance applies to ‘payment stablecoins’ as defined by the GENIUS Act, under which issuers are required to hold fiat reserves like U.S. Treasury bills equal to 100% of the total value of their issued stablecoins. As such, Peirce says the 100% haircut that some broker-dealers have observed “out of an abundance of caution” may be “unnecessarily punitive.”
Crypto supporters celebrated the news, with some predicting it will “open the floodgates for embedding stablecoins in institutional finance” and that “tokenized treasuries, equities, bonds, on-chain settlement have all become economically viable overnight.”
Others echoed this view, claiming it removed “a major friction point for regulated broker-dealers,” resulting in “better liquidity, more efficient settlement, and broader institutional on-ramps.”
SEC chair Paul Atkins was equally effusive, calling the revised rule “another terrific step in the right direction from our team in the Division of Trading and Markets to remove barriers and unlock access to on-chain markets.”
Ever since Trump returned to the White House and installed his own SEC leadership, the regulator has been systematically removing existing guardrails to crypto adoption. While the digital asset sector cheers, critics claim the regulator is abdicating its responsibility to protect investors from the certain doom these critics believe lies ahead.
WLF claims USD1 targeted by unknown attackers
The principal beneficiary of a stablecoin surge will undoubtedly be USDC, the stablecoin issued by U.S. operator Circle (NASDAQ: CRCL), although other GENIUS-compliant dollar-denominated tokens—including USD1, the stablecoin issued by the Trump-linked decentralized finance (DeFi) platform World Liberty Financial (WLF)—will also presumably get a boost.
In the meantime, WLF is crying foul over USD1’s abrupt depeg from its 1:1 value with the dollar early Monday morning. USD1’s value briefly slid from $0.9997 to $0.9942 before regaining its $0.999 range several hours later. (USD1’s value briefly slipped to $0.98 on the Binance exchange before recovering.)
WLF’s official X account tweeted that USD1 was the victim of “a coordinated attack” after the unspecified attackers “hacked several WLFI cofounder accounts, paid influencers to spread [fear, uncertainty and doubt], and opened massive $WLFI shorts to profit from the manufactured chaos.”
The account claimed the attack was heroically thwarted due to USD1’s “sound mint-and-redeem mechanism and full 1:1 backing.” WLF added that “no scammer can shake the long-term commitment of the entire WLFI team and cofounders to USD1.”
USD1 launched nearly one year ago and swiftly became one of the more prominent dollar-backed stablecoins, reaching a market cap of nearly $5.4 billion earlier this month. However, that cap began to shrink on February 12, falling to just over $5 billion on Monday before tumbling to $4.75 billion following the alleged ‘attack.’
In possibly related news, the Financial Times reported Monday that President Trump’s ‘Board of Peace,’ the fledgling alternative to the United Nations that currently has more ‘observer’ nations than actual members, could deploy its own dollar-backed stablecoin to fund its stated primary mission: rebuilding Gaza’s economy following its destruction by Israeli armed forces in response to the October 7, 2022 Hamas attacks.
We can’t say for sure whether Trump might press the Board’s members to forego creating a brand-new token when USD1 is just sitting there waiting to be used. However, given the Trump family’s ongoing dismissals of conflict-of-interest concerns related to their crypto ventures, plus the UAE’s involvement in WLF as well as the Board of Peace, we wouldn’t rule it out.
Bankers, ours
WLF’s application for a national trust bank charter continues to attract opposition from Congressional Democrats, despite few signs that the Trump appointees in the cabinet and at federal agencies see any problem here.
Earlier this month, Treasury Secretary Scott Bessent rejected requests by Democratic members of the House Financial Services Committee to pause WLF’s application. Bessent said it was a matter for the Office of the Comptroller of the Currency (OCC), which operates under the Treasury’s oversight but is “an independent entity.”Last week, the House Dems tried again, sending Bessent a letter spelling out their concerns regarding WLF’s application, including the fact that the UAE government now owns a 49% stake in the company and that a significant chunk of the $500 million price tag for that stake went directly to the Trump family.
The letter, signed by over 40 lawmakers, asks “what safeguards are in place to ensure that foreign government officials, sovereign proxies, or politically connected investors cannot use the bank-chartering process to gain leverage over the U.S. financial system or access sensitive financial or technological infrastructure?”
If Bessent replied, it hasn’t been made public. Regardless, the OCC is showing zero sign that ties to the Trump family are a dealbreaker for obtaining a national trust charter. In December, the OCC issued its conditional approval of the applications of a handful of crypto operators, including several stablecoin issuers.
On Monday, the Crypto.com exchange announced that it too had received conditional approval from the OCC for its Foris Dax National Trust Bank. Crypto.com will soon be able to offer services including custody, staking of assets, and trade settlement. For what it’s worth, Crypto.com is a major technology partner of Trump Media & Technology Group (TMTG) (NASDAQ: DJT).
Last week, Bridge, the merchant-focused stablecoin integration offshoot of payment processor Stripe, announced that its charter application had received conditional approval. Once the OCC’s final approval arrives, Bridge will be allowed to “operate stablecoin products and services under direct federal oversight.”
As for when crypto bank wannabes might receive their final approvals, the OCC granted its first full approval of a Trump 2.0 application to Silicon Valley darlings Erebor Bank earlier this month. That was about five months after Erebor received its conditional approval, so the first batch of crypto operators could become banks by May (but likely earlier).
On February 11, the American Bankers Association (ABA) wrote the OCC to suggest that it slow its approval process for all these new charter applications. The ABA suggested that a pause should last until the GENIUS Act’s regulatory frameworks are finalized, something the ABA acknowledges “is likely years away” given the numerous federal agencies that get a say in crafting these rules.
The ABA says the delay is warranted because “entities engaged in activities substantially similar to those in which some recent OCC charter applicants presumably intend to engage have failed suddenly and for reasons that have resulted in meaningful losses—not only for the broader financial services industry but consumers, too.”
Last week, the Wall Street Journal profiled the current craze among crypto operators and fintechs to skip the entire application process and simply buy an existing bank. Charters offer more limited functionality, including being barred from accepting customer deposits and making loans, but there are nearly three years to go in Trump 2.0, so check in again in a year’s time and see if those rules still stand.
Binance.US back from the dead?
Among the more notable guests at last week’s World Liberty Forum crypto shindig at Trump’s Mar-a-Lago property in Florida was Binance founder Changpeng ‘CZ’ Zhao. The appearance marked CZ’s first trip to the States following his release from prison in 2024 after pleading guilty to violating the U.S. Bank Secrecy Act in 2023.
Trump pardoned CZ last October, sparking speculation that Binance’s struggling U.S.-facing exchange Binance.US might make a comeback. CoinGecko put Binance.US’s 24-hour trading volume at just $23 million on Monday, less than half that of the equally irrelevant Gemini (NASDAQ: GEMI), but Binance.US’s figure represented a 257% surge from the day before.
What drove that surge? Likely Monday’s Bloomberg report that quoted CZ saying “we want to do much more business in the U.S. We want to bring a superior product into the U.S. We want to make the superior product offering much more accessible to the U.S. consumer.”
CZ made sure to emphasize that he was referring to Binance.US, not the dot-com mothership, the unquestioned global leader in terms of trading volume that was at the center of the shenanigans that led to its $4.3 billion settlement with U.S. authorities in 2023.
While Binance.US has struggled under the glaring eye of regulatory scrutiny over the past few years, the SEC dismissed its civil suit (with prejudice) against the company last May, and CZ now says options previously deemed impossible are now “totally possible.”
CZ claimed he’s no longer the decision-maker at Binance after stepping down as CEO following his guilty plea. But he remains Binance’s largest shareholder, and current co-CEO Richard Teng said earlier this month that CZ “has a say over important conversations” involving Binance.
Meanwhile, Binance can’t seem to shake the latest allegations regarding its role in Iran’s efforts to circumvent Western economic sanctions. CZ and Teng were among the execs pushing back on last week’s Fortune report that Binance fired several investigators after they reportedly “uncovered evidence that entities tied to Iran had received more than $1 billion through the exchange from March 2024 through August 2025.”
Those allegations got harder to dismiss on Monday as the New York Times offered its own reporting based on ‘company records and other documents.’ The Times boosted the total amount allegedly flowing through Binance to Iranian entities to $1.7 billion, adding that Teng was among the top Binance execs who received the investigators’ reports before their dismissal.
Binance spokesperson Rachel Conlan told the Times that none of the Binance staff in question were “suspended or terminated for raising compliance concerns.” Conlan said “certain individuals” were disciplined for the “unauthorized disclosure of confidential client information.”
Conlan also denied that Binance “shut down” their investigation into the alleged sanctions evasion, and further claimed that Binance would be submitting a report regarding a company named in the investigators’ reports to the U.S. Department of Justice this week.
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