Don’t Let a Crypto Carve-Out Drain the Credit that Farm Country Depends on
A loophole in the CLARITY Act would pull deposits out of hometown banks and make credit harder and more expensive for America’s farmers.
FILL OUT THE FORM to join farmers, small-business owners, and rural communities calling on the U.S. Senate to close the crypto carve-out before the CLARITY Act moves forward.
Why This Matters
1. FARMING RUNS ON CREDIT
Every spring, farmers borrow from the local community bank to cover seed, fuel, equipment, and feed, then pay it back after harvest. That credit is the difference between planting and sitting out a season.
2. Local deposits fund local lending
Community banks make roughly 80% of the nation’s farm loans and hold about two-thirds of rural deposits. They can lend only what their neighbors put in the bank.
3. The carve-out drains those deposits
As written, the CLARITY Act lets crypto exchanges pay interest-like payments for simply holding money with them, something local banks can’t match. When deposits chase those payouts, they leave hometown banks.
4. Farmers pay the price
When deposits leave, local banks have less to lend, and the next operating loan costs more. One estimate puts $1.3 trillion in deposits and $850 billion in lending capacity at risk if the loophole stays open.
5. This isn’t anti-innovation, it’s common sense
Payment stablecoins can coexist with a healthy banking system. The ask is narrow: Don’t give a crypto account a special exemption from the rules that every bank must follow.
THE LOOPHOLE
Last year’s GENIUS Act barred stablecoin issuers from paying interest on the sensible principle that a digital token acting like a checking account shouldn’t skip the rules that banks follow. However, the CLARITY Act leaves the door open: Crypto exchanges and their affiliates can still pay customers interest—or something built to work just like it—based on how much they hold and how long they hold it. If it works like interest, it competes with a bank deposit, and it pulls money out of the communities that can least afford to lose it. Closing the loophole requires only a few sentences of drafting, not a rewrite of the bill.
It’s Time for the Senate to Act
The CLARITY Act is expected to be brought to the Senate floor following the August recess. One provision, the stablecoin interest loophole, still needs to be fixed before the bill advances.
Farmers and rural communities need certainty, and community banks need a level playing field. The Senate should close the crypto carve-out and protect the agricultural lending that farm families depend on, then finish the job on responsible crypto rules. Senators from farm states, in particular, have a choice to make about who this Congress works for.
Tell your Senator: Don’t advance the CLARITY Act until the crypto carve-out is closed and farm credit is protected.