Former NYSE President Challenges Big Banks’ Stance on CLARITY Act

Tom Farley, CEO of Bullish and former President of the New York Stock Exchange (NYSE), has entered the debate surrounding the Digital Asset Market CLARITY Act, questioning the sincerity of major banks’ opposition to the legislation.

Big Banks and Trade Groups Intensify Opposition to CLARITY Act

The American Bankers Association (ABA) and the Independent Community Bankers of America (ICBA) have ramped up lobbying efforts in the Senate, urging leaders to oppose the bipartisan bill. These groups argue that Section 404 of the CLARITY Act lacks clarity in safeguarding against deposit outflows to stablecoins, potentially harming community banks. Bank of America previously warned that permitting stablecoin yields could lead to over $6 trillion in capital flight to digital assets.

A compromise was reached to address these concerns, with the CLARITY Act now prohibiting passive interest on payment stablecoins while allowing transaction-based rewards. Despite this, major banks and their allies continue to push for stricter language to mitigate perceived risks to traditional deposits.

Former NYSE President Questions Big Banks’ Motives

Farley expressed skepticism about the banks’ stated intentions, stating he is “not 1,000% convinced” their resistance stems from protecting community banks. He highlighted how large institutions profit by offering minimal interest to depositors while investing in high-yield Treasuries, suggesting their opposition is driven by self-interest rather than genuine concern for smaller banks.

Patrick Witt, Executive Director of the President’s Council of Advisors for Digital Assets, echoed these concerns, questioning, “You mean to tell me that the entities that have absorbed community bank market share for decades might not have their best interests at heart?” Witt also dismissed the ABA and ICBA’s recent lobbying efforts, urging them to “give it a rest.”

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