By Jason Stverak
Every major modernization debate in Washington eventually comes down to one simple question: Who gets to compete?
The Digital Asset Market Clarity Act is no different.
Congress has an opportunity to establish the first comprehensive regulatory framework for digital assets in the United States. Done correctly, this legislation can strengthen consumer protections, reinforce the dollar’s role as the world’s reserve currency, encourage responsible innovation, and keep the United States at the forefront of financial technology.
But Congress also has a choice to make.
Will the digital financial system of tomorrow be open to all federally regulated financial institutions or will it become dominated by the nation’s largest banks and technology companies?
For the Defense Credit Union Council, that question is about more than market share.
It is about ensuring the men and women who wear our nation’s uniform continue to have access to trusted, member-owned financial institutions that understand military life.
Defense credit unions serve service members stationed around the world. They support military families living across multiple time zones. They provide financial services on installations where few other institutions choose to operate. They help families survive government shutdowns, deployments, PCS moves, and emergencies.
Financial Readiness Is Military Readiness
As digital payments evolve, Congress should ensure the credit unions serving America’s military and their families evolve alongside them.
The Senate’s Digital Asset Market Clarity Act takes an important step in that direction.
Section 401 expressly recognizes federal and state-chartered credit unions and authorizes them to engage in digital asset activities they are otherwise permitted to perform, including custody, payments, digital asset-secured lending, wallet services, distributed ledger activities, and facilitating member transactions. That is a significant improvement over earlier proposals that largely focused on banks and securities firms.
Congress deserves credit for recognizing that credit unions belong in America’s digital financial future.
But recognition is not enough.
Throughout the remainder of the legislation, the regulatory framework still largely assumes a banking model.
Large banks can deploy digital asset products through bank subsidiaries, holding companies, broker-dealers, trust companies, and affiliates. Credit unions rely on a very different structure. They innovate through Credit Union Service Organizations, credit union subsidiaries where permitted under state law, and specialized third-party technology providers.
If Congress truly wants competitive neutrality, those delivery models deserve the same legal certainty banks receive.
Innovation should not depend on charter type.
Likewise, regulatory parity must mean more than simply mentioning credit unions in one section of the bill.
Whenever the legislation assigns responsibilities to the Federal Reserve, OCC, FDIC, or state banking regulators, we shouldn’t have to ask: Where is the NCUA?
The NCUA is the prudential regulator for the federal credit union system. It understands the cooperative business model, the unique capital structure of credit unions, and the mission of institutions serving military installations and underserved communities.
Equal regulation means equal representation.
Stablecoin Yield
Another issue that deserves attention before Congress finishes this legislation is stablecoin yield.
The legislation appropriately prohibits payment stablecoin issuers from paying interest simply because someone holds a stablecoin. It also prevents digital asset service providers from creating synthetic savings accounts through passive yield programs that compete directly with federally insured deposits.
That protection is essential.
Credit unions use insured member shares to finance auto loans, mortgages, small business lending, and emergency credit for working families. Defense credit unions rely on stable military payroll deposits to provide affordable financial services for service members across the globe.
Congress should not allow technology companies to recreate bank accounts without the same prudential safeguards that protect consumers today.
Furthermore, the final legislation should eliminate uncertainty surrounding the application of federal consumer financial protection laws to payment stablecoins.
Today, it remains unclear which existing federal consumer protection statutes and regulations apply when consumers use payment stablecoins for everyday financial transactions. Questions remain regarding error resolution, unauthorized transactions, disclosures, unfair or deceptive acts and practices, dispute resolution, and other consumer protections that Americans have come to expect when using traditional financial products.
Congress should provide that clarity before asking millions of Americans to embrace this new financial infrastructure.
For defense credit unions, these issues carry additional weight.
Military families increasingly move money across borders. They rely on instant access while deployed overseas. They face unique cybersecurity threats, foreign adversary activity, sanctions concerns, and fraud schemes targeting service members.
The institutions serving those families should not be forced to compete with one hand tied behind their backs.
America’s digital asset future should promote innovation.
It should promote competition.
It should protect consumers.
And it should recognize that financial inclusion is not achieved by empowering only the nation’s largest financial institutions. Congress must ensure that credit unions have an equal place in America’s digital asset environment.
Jason Stverak is Chief Advocacy Officer at the Defense Credit Union Council.