The Independent Community Bankers of America (ICBA) has launched a six-figure advertising campaign in Washington DC to oppose the Clarity Act, a bill that would regulate stablecoins.
The ICBA represents about 4,000 small community banks across the US.
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The group warns that the legislation could allow crypto companies to offer rewards for stablecoin transactions, potentially draining $1.3 trillion in deposits from local lenders.
That could deprive small businesses and farmers of $850 billion in loans, according to the ICBA.
ICBA President Rebeca Romero Rainey said community banks fund more than 60% of all small business loans and 80% of agricultural loans in the US.
“They are, in many cases, that local economic engine, because they are taking local deposits and redeploying them in the form of loans, and creating economic growth,” she said.
If the Clarity Act passes in its current form, Rainey argued, the core mechanism that keeps rural economies thriving could disappear.
“How are those loans funded in the future? And we might argue they wouldn’t be,” she said.
The campaign expands the battle beyond Wall Street into rural America, raising questions about the real impact of the Trump administration’s push to legitimize cryptocurrencies.
It also creates an ideological battle for Republicans as they head into midterm elections: side with the administration or with small farmers and rural borrowers.
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Guaranty Bank & Trust President Troy Richards is worried about what the bill will mean for his industry.
