White House Rejects Jamie Dimon Call For Bank-Level Rules In CLARITY Act – Crypto Advisor Calls It ‘Deceit’

White House Crypto Council Executive Director Patrick Witt said stablecoin issuers don’t need to face bank-level regulation since they don’t lend out deposits.

• In a post on X, White House Crypto Council Executive Director Patrick Witt rejected JPMorgan CEO Jamie Dimon’s argument that stablecoin issuers should be subject to the same regulations as banks.
• According to him, banks are heavily regulated because they lend out deposits, something that the GENIUS Act prohibits stablecoin issuers from doing.
• President Donald Trump also critisized banks for holding the CLARITY Act “hostage.”

White House Crypto Council Executive Director Patrick Witt, on Tuesday night, hit out against JPMorgan (JPM) CEO Jamie Dimon’s assertion that crypto companies should be subject to the same regulations as banks if they want to earn rewards on stablecoins. 

“The deceit here is that it is not the paying of yield on a balance per se that necessitates bank-like regulations, but rather the lending out or rehypothecation of the dollars that make up the underlying balance,” he said in a post on X. “The GENIUS Act explicitly forbids stablecoin issuers from doing the latter.”

Simply put, Witt said that the reason banks are subject to stricter regulations is not because they pay interest on deposits but because they take in money to lend to other people. That is what creates risk. If too many people want their money back at once, a “deposit run,” then rules need to be in place to ensure banks have the funds to pass on.

Moreover, the GENIUS Act clearly states that stablecoin issuers cannot lend out the dollars that back their stablecoins. Those funds are kept in reserve. According to Witt, since they are not lending out customer funds, they are not operating like banks.

What Did Jamie Dimon Say About Stablecoins?

In an interview with CNBC earlier this week, Dimon said that he wants crypto firms and banks to operate on a “level playing field.” According to him, if firms like Coinbase (COIN) and PayPal (PYPL) are going to pay rewards to their users for holding stablecoins, that is akin to banks holding deposits and paying interest. 

“We have social requirements. We have liquidity requirements, capital requirements, transparency requirements, reporting requirements, board requirements, government requirements,” said Dimon. “If they want to be a bank, so be it.”

Trump Joins Crypto-Bank Battle

U.S. President Donald Trump also hit out against banks on Tuesday night, stating that they were holding the CLARITY Act “hostage” and getting in the way of America’s crypto progress. Coinbase CEO Brian Armstrong and other members of the company reportedly visited the White House, but it has not been confirmed whether they met Trump in person as well. 

The overall cryptocurrency market edged 0.3% higher in the last 24 hours, keeping above $2.4 trillion. Bitcoin (BTC) rose 0.7% to around $68,7000, showcasing resilience even as the tensions between the U.S., Israel, and Iran battered global stock markets, with the South Korean stock exchange, KOSPI, dropping more than 10% in intraday trade. Retail sentiment around the apex cryptocurrency on Stocktwits dipped to ‘bullish’ from ‘extremely bullish’ territory over the past day.

COIN’s stock also edged 0.93% higher in overnight trade even as the broader stock market moved lower after hours. Retail sentiment around Coinbase fell to ‘bearish’ from ‘neutral’ territory over the past day. 

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