White House Suggests $500K Daily Fines for Avoiding Yield Restrictions

The White House is proposing strict regulatory measures, including daily $500,000 civil penalties, to prevent firms from offering yield or interest on stablecoin balances. These provisions are designed to stop firms from creating products that mimic yield farming on stablecoin balances. The latest discussions with crypto industry leaders are focused on whether firms can offer rewards linked to specific user activities. The proposed regulation would grant the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) enforcement authority to issue these civil penalties. Trade groups and crypto firms continue to negotiate and seek compromise on allowing stablecoin rewards. The objective is to reach a consensus by the end of the month.