Major U.S. banking trade groups, including the American Bankers Association and the Bank Policy Institute, are urging Congress and regulators to amend the recently enacted GENIUS Act, which created a federal framework for dollar-pegged stablecoins. The industry says the statute contains a loophole that lets crypto exchanges and other non-bank issuers pay interest or rewards on stablecoins even though banks remain barred from offering comparable yields. In letters sent this week, the lobbyists warned that higher returns on stablecoins could prompt customers to pull deposits from traditional accounts, potentially repeating the large‐scale disintermediation that hit banks in the 1980s. A U.S. Treasury analysis cited by the groups projects that as much as $6.6 trillion could be withdrawn from the banking system if the rule is left unchanged. Ronit Ghose, Citi’s global head of digital assets, said interest-bearing stablecoins "may spark massive withdrawals," underscoring the competitive threat the tokens pose. With stablecoin capitalization now above $280 billion, banks contend that either the interest payments must be banned or lenders should receive equal authority to offer them, setting the stage for a policy fight over the future of dollar funding.