There are two sides to every stablecoin rule. The editorial 'The Crypto Lobby Objects' (Aug. 7) argues for stricter limits on stablecoin rewards because such payments may pull deposits from small banks. That concern is fair, and community banks matter to the towns that borrow from them. But it is only one side of the coin.

Section 10404(b) of the Clarity Act warns that deposit-like payments may inhibit the work banks do for the economy, yet also calls activity-based rewards 'critical to enabling innovation, competition, and consumer adoption.' These aims aren’t mutually exclusive.

Rewards are how stablecoin platforms compete for the funds customers hold and move. Too tight a limit would blunt competition that could make moving money cheaper for ordinary Americans. Stablecoin platforms use rewards to attract users, offering cheaper and faster transactions than traditional banks. A strict cap could stifle this progress. Striking the right balance is essential to foster innovation while protecting community banks.