Coinbase Champions Stablecoin Innovation Amid Banking Sector Resistance at White House

As of February 2026, a significant regulatory and ideological clash is unfolding in Washington D.C., with the WHITE House serving as the central arena. The debate centers on the future of stablecoins—digital assets pegged to traditional currencies like the U.S. dollar. On one side, leading cryptocurrency exchanges and blockchain companies, notably Coinbase and Ripple, are advocating for the growth and integration of these assets into the broader financial ecosystem. Their position highlights the consumer benefits and innovation driven by features such as yield-bearing rewards or interest on stablecoin holdings. On the opposing side, traditional banking institutions are mounting a firm defense, arguing that these rewards programs pose a substantial threat to the stability and primacy of the conventional financial system. They contend that such offerings could lead to destabilizing capital flows away from traditional banks. This fundamental disagreement over the permissibility and scope of 'yields' has resulted in a stalemate in policy discussions, with banking representatives showing no willingness to compromise. The impasse underscores a pivotal moment for digital asset regulation in the United States, as industry pioneers push for forward-looking frameworks while incumbents seek to curb what they perceive as risky competition. The outcome of this high-stakes debate will have profound implications for the accessibility of cryptocurrency products, the competitive landscape of finance, and the pace of technological adoption in the American economy.

Stablecoins: Coinbase and Banks Clash at the White House over Rewards

The White House has emerged as a battleground for a high-stakes debate over stablecoins, pitting crypto industry leaders like Coinbase and Ripple against traditional banking institutions. At issue are the rewards offered on these digital assets, which banks argue threaten the stability of the traditional financial system.

Washington talks have stalled as bankers refuse to yield on the question of yields. The American Bankers Association insists any regulatory framework must protect local credit markets, while crypto firms demand clarity without restrictive measures. Political maneuvering continues as the U.S. seeks to establish comprehensive stablecoin regulations.

Coinbase Expands into Prediction Markets Amid Legal Challenges

Coinbase has launched prediction markets accessible to users across all 50 U.S. states, partnering with regulated platform Kalshi to offer trading on sports, political events, and economic indicators. The feature allows users to take positions on real-world outcomes using cash or USDC stablecoin, with minimum trades starting at $1.

The MOVE comes as Coinbase faces a lawsuit in Nevada, underscoring the regulatory tightrope the exchange navigates. CEO Brian Armstrong touted prediction markets as "the ultimate form of truth-seeking," emphasizing their reliability when participants have "skin in the game."

Liquidity for the new markets initially flows from Kalshi, a CFTC-regulated operator valued at $11 billion. Coinbase plans to integrate additional providers in the future, expanding its offerings beyond traditional cryptocurrency trading.