Mastercard signs 85 crypto companies to its payments network as banks lobby Congress to ban stablecoin yield and activity-based crypto rewards in the CLARITY Act, despite Mastercard already offering them.
The fight holding up the most consequential crypto legislation in years comes down to a surprisingly simple question: should crypto platforms be allowed to pay you something for your money? Banks say no, and they’ve spent months lobbying Congress to codify that position. Meanwhile, Mastercard announced on Wednesday it had signed up more than 85 crypto companies, including Circle, Binance and Gemini, into a unified payments program. The Gemini Mastercard already pays 4% back in crypto on gas purchases, on Mastercard’s own rails, which banks are telling Congress to prohibit for crypto platforms.
The Digital Asset Market Clarity Act, which passed the House 294–134 last July and has been stalled in the Senate ever since, is broadly about giving crypto a regulatory framework. But one provision continues to hold up the bill: whether exchanges and affiliated platforms can offer yield, rewards, or interest-like payments on stablecoin holdings. Banks want that banned outright. The White House tried to broker a middle ground in February, proposing that activity-based rewards (earned through transactions, not from just sitting on a balance) should be allowed, like those Mastercard currently offers through crypto partners. Banks said no to that too. The stalemate blew past a White House-imposed March 1 deadline, and a Senate Banking Committee markup is now targeting mid-to-late March.
Let’s take a look at where things stand now.
Mastercard expands crypto integration
The program is a formalized integration framework that gives crypto companies a standardized way to connect to Mastercard’s global network. The focus is on three commercial use cases: cross-border remittances, business-to-business payments, and global payouts. The technical backbone is Mastercard’s Multi-Token Network (MTN), a settlement layer that moves stablecoins and tokenized deposits across financial institutions in real time. JPMorgan’s Kinexys unit, the bank’s blockchain and digital payments division, completed test transactions through Mastercard’s network as part of a pilot for institutional B2B settlement, which tells you something about how seriously Wall Street is taking the infrastructure.
The numbers behind the announcement help explain the push. Stablecoin payments hit $390 billion in 2025, representing 673% growth YoY growth, according to a February 2026 report from McKinsey. B2B stablecoin payments alone hit roughly $226 billion annually, up 733% year-over-year. Essentially, Mastercard is building a core business line around the thing banks are telling Congress is an existential threat.
The argument banks are making and what it leaves out
To understand the contradiction, we need to look at how banks have framed the yield fight. Their position, stated across three separate lobbying campaigns this year, is that any form of compensation attached to stablecoins (yields, rewards, promotional payments, etc.) is a loophole that will drain deposits from community banks and credit unions and into crypto platforms, ultimately starving local communities of mortgage loans, farm loans, and small business credit.
The lobbying effort has been substantial. The CEOs of eight national trade associations, including the American Bankers Association and the Independent Community Bankers of America, sent a joint letter to the Senate in January demanding a comprehensive ban on all stablecoin inducements, whether paid by the issuer or any affiliated platform or partner. They cited a Treasury Department estimate that $6.6 trillion in bank deposits could be at risk if incentives persist. The ABA and all 52 state bankers associations filed their own separate letter. And in January, more than 3,200 individual bankers signed a third letter making the same demand. The coordinated message: stablecoins should be payment instruments, not savings substitutes, and any reward is a dangerous first step toward deposit flight.
What the letters don’t mention is the Gemini Mastercard, which pays 4% back in crypto on gas, EV, and transit purchases, 3% on dining, and 2% on groceries. Or the MetaMask Card, which offers 1% stablecoin cashback on its free Virtual tier and 3% on its Metal card. Both run on Mastercard rails, both partner with traditional financial institutions, and both give consumers a yield-equivalent benefit on their activity — the exact same economic outcome as the activity-based rewards the White House proposed as a compromise. The banks killed that compromise. They have not, to anyone’s knowledge, sent a single letter about Mastercard’s crypto card ecosystem.
Patrick Witt, Executive Director of the President’s Council of Advisors for Digital Assets, made the logical endpoint of that position plain this week.
“Arguably my favorite part of this rewards/yield debate has been when bankers say ‘if we allow this, then we’ll see massive deposit flight,’” he wrote on X. “Crypto has already been offering rewards/yield on stablecoins for years. Where is the deposit flight? Is it in the room with us right now?”
Arguably my favorite part of this rewards/yield debate has been when bankers say “if we allow this, then we’ll see massive deposit flight.”
Crypto has already been offering rewards/yield on stablecoins FOR YEARS.
Where is the deposit flight? Is it in the room with us right now?
— Patrick Witt (@patrickjwitt) March 11, 2026
In a separate post also on March 10, Witt was more direct about what’s at stake for the bill itself: “The CLARITY Act must remain a pro-innovation piece of legislation. Attempts to hijack the legislative process and turn it into an anti-competition bill are shameful.”
As Witt points out, the supposed deposit flight hasn’t happened, even as reward-equivalent products that were supposed to cause it already exist, on Mastercard-powered cards, with bank partners. Others point out the hypocrisy in banks being quiet on partners like Mastercard allowing the same incentives they are fighting to prevent for crypto exchanges.
Senate members plead with banks over CLARITY compromise
The Clarity Act’s stall has been well-documented. Senate Banking Committee negotiations with the White House produced draft compromise language in February, but the March 1 deadline passed without a deal. Prediction markets have priced the bill passing this year at roughly 70–74% on both Kalshi and Polymarket, per the DeFi Rate Clarity Act tracker, but the yield provision remains the variable most capable of moving those odds in either direction.
One of the more notable voices to weigh in this week wasn’t from the crypto side. On Tuesday, Sen. Angela Alsobrooks (D-MD) spoke at the American Banking Association’s own Washington Summit, the same conference where the banking lobby had gathered, and told the room that everyone involved “will probably walk away just a little bit unhappy.” She described compromise language she and Sen. Thom Tillis (R-NC) have been developing that would put deposit-flight guardrails in place and “allow innovation to grow at the same time,” and said, “we’re going to probably have to make some compromises.” Her message was clear: “Don’t let perfect be the enemy of good.”
Sen. Cynthia Lummis (R-WY) amplified the remarks on X, noting that the status quo with no bill, no guardrails, and unchecked growth is worse for banks than a negotiated deal that actually controls the thing they’re worried about.
Thank you, @Sen_Alsobrooks, for the reminder that the status quo is worse for banks than a bipartisan compromise in the Clarity Act which prevents deposit flight and promotes innovation.
America needs clarity. Let’s get it done. pic.twitter.com/33HzZMwPJ3
— Senator Cynthia Lummis (@SenLummis) March 10, 2026
Alsobrooks was telling the people lobbying hardest against compromise that compromise is their best protection. President Trump made the same argument from the other direction earlier this month, posting on Truth Social that banks were holding the bill “hostage” and calling for passage without delay. Senate Banking Committee Chairman Tim Scott said at a February hearing that the deposit flight banks are predicting simply has not materialized, pointing to recent deposit growth data.
Beyond the yield fight
The yield fight is one provision in a much larger piece of legislation. The Clarity Act’s primary job is to divide regulatory authority between the SEC and the CFTC depending on whether a digital asset functions as a security or a commodity, a structural decision with downstream consequences for everything from institutional token offerings to the settlement infrastructure that prediction markets run on. Mastercard’s Multi-Token Network is exactly the kind of institutional settlement layer that CFTC jurisdiction under the Clarity Act would govern.
As we’ve covered previously, what happens to tokenized asset regulation has direct implications for how prediction markets operate. That includes whether platforms like Kalshi and Polymarket can eventually route payouts through the same normalized rails that Mastercard is building out now.
Who the rules apply to
Banks aren’t wrong that stablecoins will change the deposit landscape. What Wednesday made clear is that the question isn’t whether consumers will accumulate crypto value through their financial activity, which they can already do. The question is who gets to do it with a regulator’s blessing and who doesn’t.
What senators ultimately have to weigh is whether the yield ban protects the financial system or primarily aims to insulate banks from having to compete for deposits. If banks successfully strip yield entirely from the bill, that outcome will sit alongside Mastercard’s 85-partner crypto program and the 4% crypto cashback card in their own network, an awkward coexistence that’s going to be hard to explain to the next senator who asks why the rules only apply to the new entrants.
