Rodney Walker Urges Congress to Close Genius Act Loophole

From the Walker campaign

Lineville, AL — Rodney Walker, career businessman, cattle farmer, and candidate for United States Senate from Alabama, today called on Congress and federal regulators to act immediately to close a dangerous loophole in the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) that threatens community banks, farm credit, and everyday cash users in rural America.

"The heart of rural Alabama is our local banks, our churches, our hometown businesses, and the neighbors who stand by one another," Walker said.

"A gap in the GENIUS Act lets crypto platforms pay reward-style incentives through third parties that aren't subject to the same guardrails as banks. That lures deposits away from community banks, threatens farm and small-business lending, and exposes hardworking people to uninsured, unregulated risk. I will fight to protect our hometown banks, our cash choices, and the independence of everyday Americans."

Key concerns Walker highlights:

1. The GENIUS Act bars stablecoin issuers from paying interest directly but does not clearly forbid third-party crypto platforms and exchanges from offering reward- or yield-style incentives that compete directly with insured bank deposits.

2. Deposits pulled from community banks reduce funds available for farm and small-business lending, putting rural lending, jobs, and local services at risk.

3. Funds parked on crypto platforms are typically not FDIC-insured; failures or fraud could leave depositors with no protection.

4. A truly cashless, fully digital monetary system risks eliminating the informal, everyday cash transactions that many rural families rely on for side jobs, gifts, and community giving.

Walker proposes:

1. An immediate Congressional amendment or regulatory guidance that closes the third-party reward loophole by treating third-party reward payments tied to stablecoins as subject to the same prohibitions and reserve and insurance requirements as bank deposits.

2. Stronger consumer protections and mandatory insurance for any deposit-like digital products.3. Safeguards to preserve the ability to use and hold physical cash and to protect small community banks that serve rural America.

Walker noted the stakes are high: "If we don't act, community banks will lose deposits, lending will shrink, and our farmers and small businesses will suffer. This is about common-sense protections for our neighbors and preserving the way of life that built Alabama."

For more information on Rodney Walker and his Senate campaign, please visit https://walkerforalabama.com.