The Independent Community Bankers of America (ICBA) has launched a new advertising campaign that warns the public about the risk of crypto.
The banking sector believes they are currently under threat because of the emergence of digital assets and have sought to undermine its development, most recently challenging the CLARITY Act. While approved by the Senate Banking Committee, the legislation which outlines crypto market infrastructure including consumer protections, still must pass a full Senate vote before it is reconciled with the House version of the bill.
The ICBA declares that crypto lacks the same level of consumer protection as the banking sector.
ICBA President and CEO Rebeca Romero Rainey says that American’s care about their local economies but they are unaware of the “risks of giving crypto conglomerates a free pass.”
The advertisement issues a stark warning about the dangers of crypto:
“Community banks make sixty percent of small business loans and eighty percent of farm loans. Community banks protect your money with strong oversight and FDIC insurance. Polls consistently rank crypto at the very bottom of issues important to American voters. But crypto insiders are pushing for less accountability—and more risk. American families don’t want experiments with their money.They want jobs, growth, and available credit. When crypto gets a free pass, communities pay the price.”
While not including any details, the promotion aims to sway sentiment away from supporting the emerging digital asset sector and ostensibly to push back against the pending legislation. The ICBA touts the importance of community banks while claiming “allowing digital asset entities to pay interest or yield on payment stablecoins would significantly reduce community banks’ ability to support local lending needs.”
There is no proof that stablecoin yield will detract from bank lending but what it could do is compel banks to better compete for deposits by matching or topping any stablecoin returns. This would, of course, undermine profits of smaller banks, something the ICBA would like to protect.
