Here’s the other thing. Imagine stablecoins are forbidden from passing yield in actual returns or in rewards to holders just for holding. Then people would just set up (offshore) businesses that take USDT deposits and issue ybUSDT (yield-bearing USDT) as depository certificates. The business would then redeem the user’s USDT for USD and then use that to buy T-bills. When it comes time for the user to redeem their ybUSDT for USDT, the company would just sell the T-bills for USD or, if the term is fixed, just take USD at maturity and transform it into USDT with a little bit of extra USDT to represent the accrued yield. In essence, you can always transform a non-yield-bearing stablecoin into a yield-bearing one. So the banks are mostly arguing over nothing. Forcing stables to not have direct yield in monetary or other reward form does nothing but create unnecessary extra counterparty risk in the rehype chain. Even if you forbade Tether from redeeming USDT for USD for businesses who do this activity, then the businesses could just engage in bilateral contracts with separate third parties for synthetic T-Bill exposure where the third party just hedges by buying T-Bills. So basically this is unavoidable and I’m not even sure why there is anything to argue about.(Galois Kevin)