Why a U.S. Ban on Yield-Bearing Stablecoins Would Help 'Too Big to Fail' Banks - Ep. 840

Unchained

Laura Shin

News, Tech News, Business News

4.5 • 1.3K Ratings

🗓️ 23 May 2025

⏱️ 45 minutes

🔗️ Recording | iTunes | RSS

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Summary

Yield-bearing stablecoins have had decent growth, now topping $6 billion in supply and paying out nearly $600 million to users, according to data from Stablewatch. But just as these products go mainstream, the U.S. Senate is moving forward with a stablecoin bill that could ban them outright in America. In this episode, NYU professor and Zero Knowledge Consulting founder Austin Campbell joins Laura to break down: Why yield-bearing stablecoins are under fire in Washington Why Dems are pushing for the ban and who stands to benefit How this bill could give foreign issuers an edge over U.S. ones Whether yield-bearing stablecoins are securities under U.S. law And what the future holds for projects like Ethena, Sky, and others Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com Thank you to our sponsors! Bitkey: Use code UNCHAINED for 20% off Focal by FalconX Austin Campbell, NYU Stern professor and founder and managing partner of Zero Knowledge Consulting Unchained: How the Senate Stablecoin Bill Enriches Corporations at the Expense of Consumers Stablecoin Bill Passes Key Hurdle: Dems Join GOP to Deliver a Crypto Win Tether in the Clear? Yes, Under This New Republican-Led Senate Stablecoin Bill Stablecoin Bill Stalls in Senate as GOP Cries Foul Over Dem Resistance Timestamps: 0:00 Introduction 💣 1:29 Why the new stablecoin bill takes direct aim at yield-bearing stablecoins 🗳️ 3:36 How Democrats are driving the push for a ban and what their motivations might be 🏦 6:28 Why calling stablecoins “banks” leads to major policy confusion 🌍 13:49 How the bill could hand an advantage to offshore stablecoin issuers 🎒 19:31 Whether Tether is warning about risk or just protecting its own interests ⚖️ 21:09 Are yield-bearing stablecoins actually securities under U.S. law? 💰 23:40 What real benefits yield-bearing stablecoins offer to users 🚫 29:54 Why Austin opposes the proposed 10% interest cap 📚 32:04 Why Ethena would likely be regulated under market structure rules instead 📰 35:04 Weekly News Recap Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	The single biggest set of beneficiaries of interest-faring stable coins being banned are going to be the largest financial companies in America.
0:09.8	If you think the too big to fail problem is bad now, wait until you do this.
0:19.6	Hi, everyone. Welcome to Unchained, your no hype resource for all things crypto. I'm your host,
0:24.3	Laura Shin. Every episode, we'd love to feature your comments. Today, we have responses to my recent
0:29.3	interview with Linda Shea, developer ecosystem lead at Farcaster. Linda and I discussed
0:33.8	micro payments for content and whether this will finally take off on Farcaster.
0:42.3	On X, Redrum Rick said, LFG, let's see a Farcaster can make it happen.
0:46.6	If you want your response featured, leave it on a video on YouTube, Farcaster, or X.
0:50.4	This is the May 23rd, 2025 episode of Unchained.
0:56.0	BitKee is the Bitcoin wallet from the team behind Square and Cash app. It's the first two of three multi-sig hardware wallet with recovery tools that replace the need for a seed phrase.
1:02.8	Get 20% off with code unchained.
1:05.0	An AI that speaks crypto and does the work of a team of analysts.
1:15.5	Introducing Focal by Falcon X, bringing in clarity to a world of noise.
1:17.9	Visit askfocal.com.
1:23.9	Today's guest is Austin Campbell, NYU Stern Professor and founder and managing partner of Zero Knowledge Consulting. Welcome, Austin.
1:26.6	Thank you very much. Happy to be back.
1:29.1	The U.S. is potentially on the verge of passing a stable coin bill in the Senate. This was thought to be
1:34.5	one of the few pieces of bipartisan legislation that Congress might take up this session,
1:38.9	but it's proved to be a more contentious process than expected. An initial attempt to get
1:43.6	passed a procedural step known as the
1:45.2	cloture vote to allow for floor debate initially failed, and it finally passed on Monday of this
1:50.9	week. You've been especially critical of one of the provisions, which would ban yield-bearing or
	...

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