Le Coin analysis: A credit card routing bill could give banks a reason to pick a stablecoin lane, or a lane nobody uses

Key points

• The bill is about routing, not price: S. 3623 would bar issuers with more than $100 billion in assets from locking a credit card to one network or to the two networks with the largest market shares as the Federal Reserve determines them, and would let merchants choose the route. It sets no fee cap [1].
• Le Coin's analysis, not the bill: a covered bank will enable the second network that still pays it. An independent stablecoin rail could do that if the coins stay outstanding on the bank's platform; a second network built to go unused is the other option.
• Debit has already tested the dodge: the Federal Reserve found that some issuers had left merchants with a single network for online debit, and tightened its rule in 2022 [10][11].

A Senate bill would let merchants, not card-issuing banks, choose the network that carries a credit card payment.

The Credit Card Competition Act of 2026, S. 3623, would direct the Federal Reserve to write rules for "covered card issuers," meaning issuers that, with their affiliates, hold more than $100 billion in assets [1]. Those issuers could not restrict a credit card to one network, to networks that are all affiliated with each other or with the issuer, or to the two networks with the largest market shares as the Fed determines them [1]. The sponsors describe the result as at least two unaffiliated networks on each card, "including one outside Visa/Mastercard" [4][5]. Issuers and networks could not inhibit a merchant's choice of route, or penalize it [1]. The bill sets no cap on swipe fees. Cards issued in a "3-party" model, where the issuer is the network or shares its ownership, are exempt; that is the model American Express runs [1][19]. The bill does not mention stablecoins [1].

Sen. Roger Marshall (R-Kan.) introduced the bill on Jan. 13, 2026, with Sens. Dick Durbin (D-Ill.) and Peter Welch (D-Vt.) [1]. In the GovInfo bill-status record pulled Oct. 9 at 1:23 a.m. ET, the latest action was referral to the Senate Banking Committee, and the introduced text was the only version [2]. If enacted, the Fed would have one year to write the rules, which would take effect 180 days after each set is final [1].

A bank will switch on the second network that still pays it

What follows in this section and the next is Le Coin's analysis. None of it is a provision of the bill.

A covered bank would have to add a second route to its credit cards. What it cares about is interchange, the fee that moves from the merchant's side to the card issuer on each sale. Visa's published schedule calls interchange a transfer between financial institutions; the merchant pays a "merchant discount" to its own bank that covers it [16]. So the bank's question is simple: which second network leaves it paid?

A rail the bank owns is the weaker answer, not a clearly illegal one. The bill bars cards limited to networks that are all affiliated with the issuer [1]. It does not say a bank-owned lane sitting beside Visa or Mastercard is barred. The question regulators asked about debit still hangs over it: is the merchant getting a real choice? An independent rail sidesteps that question.

An independent stablecoin rail could pay the bank either way, but only one way on each side. If the merchant stays on Visa or Mastercard, the bank collects interchange as it does today. If the merchant routes the sale to the coin, the sale itself pays the bank nothing. The money is in the coin staying outstanding. Reserves backing a payment stablecoin sit with its issuer, and the issuer earns the income on them [12][14]. A bank that does not issue the coin itself shares in that only through a commercial deal with the issuer that pays it for coins held on its platform, such as the cardholder's funding balance or the merchant's settlement balance, for as long as they stay there. A coin sold or redeemed for dollars as soon as it arrives leaves the platform and earns the bank nothing. GENIUS bars a permitted issuer from paying a holder "any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding, use, or retention of such payment stablecoin" [14]. The bar runs from issuer to holder and does not mention distributors. Whether a distribution payment tied to coins held on a bank's platform falls inside it is untested, and no primary source cited here sets the terms of such a deal.

USDC shows how such a payment could work, because Circle already pays distributors. In its latest quarterly report, Circle says its reserve income "is a function of (i) our stablecoins in circulation over a given period and (ii) the reserve return rate" [12]. It says it incurs costs "to incentivize distributors to use and distribute Circle Digital Assets," and that its payments to key distributors "are directly impacted by the amount of USDC held on their respective platforms" [12]. Its annual report calls reserve income "a contributor to distribution costs" [13]. The payment follows coins held, not sales routed. Circle says it expects to add distributors and that their contracts "may have different commercial terms" [12]. A card-issuing bank would be a new kind of distributor. No primary source Le Coin found shows any bank negotiating those terms.

The networks are moving too. Visa and Mastercard both say they already support stablecoin settlement inside their own systems, and Visa's annual report says that with more regulatory certainty and permissive or favorable regulations, "stablecoins could potentially disrupt existing payment networks" [17][18].

The thesis has one legal gap to cross. The bill's routing rules apply to a "payment card network," which existing law defines as an entity that provides the services, infrastructure and software that route information and data to conduct debit or credit card authorization, clearance and settlement, and that a person uses to accept a brand of debit card, credit card or other device as payment [9]. The bill leaves that definition alone and does not say whether a network that settles in a stablecoin could qualify [1][9]. Until the Fed answers that, the stablecoin lane is a scenario, not a route.

A bank could also skip the middleman. GENIUS lets a subsidiary of an insured depository institution, once approved, become a permitted issuer [14]. Its issuing subsidiary would then earn the reserve income on that coin, as Circle does on USDC [12][14]. But a lane built on the bank's own coin starts to look like a rail the bank owns, the weaker answer under the routing bill.

The other choice is a second network built not to be used

A bank that wants to keep every dollar of interchange has another option: comply on paper. It can enable a second network weak enough that merchants never send it a sale.

Debit is the precedent. The Durbin amendment, section 1075 of the Dodd-Frank Act of 2010, directed the Fed to bar issuers and networks from restricting debit transactions to fewer than two unaffiliated networks [11]. Under the Fed's Regulation II, issuers had to comply by April 1, 2012 [10]. When the Board wrote that rule in July 2011, it later said, "the market had not developed solutions to broadly support multiple networks for card-not-present debit card transactions" [15].

A decade later, the Board said data and industry information showed "some issuers are not enabling two unaffiliated networks to process card-not-present transactions, and as a result, merchants often can route card-not-present debit card transactions only over a single network" [11]. It cited comment letters and Board data suggesting that "several of the largest issuers" had not enabled two networks for online debit [11].

The Fed then narrowed the tactic. A final rule announced Oct. 3, 2022, and effective July 1, 2023, specifies that the two-network requirement covers card-not-present transactions such as online payments [11][15]. Regulation II now says an issuer complies only if each enabled network "has taken steps reasonably designed to be able to process" the transactions it would reasonably expect to be routed to it [10].

A credit bill could go the same way. S. 3623 bars limits on the number of networks and on a merchant's routing [1]. It does not say how well a second network has to work. The Fed would decide that. For debit, more than a decade passed between the first rule and the fix for online payments [1][10][11].

GENIUS makes the coin a legal way to settle, and Washington likes what backs it

The GENIUS Act, signed July 18, 2025, defines a payment stablecoin as a digital asset "used as a means of payment or settlement" that the issuer must redeem for a fixed amount of money [14][20]. Only a permitted issuer may issue one in the United States [14]. Reserves must back the coins at least one-for-one, and eligible reserves include Treasury bills, notes or bonds with 93 days or less to maturity [14]. The same law bars a permitted issuer from paying a holder any interest or yield solely for holding, using or keeping the coin [14].

The arithmetic follows. More coins outstanding means more reserves, and short-term Treasuries are among the assets that can fill them. The White House said as much on signing day: "The GENIUS Act will generate increased demand for U.S. debt" [20].

In Le Coin's analysis, that gives this administration a reason to prefer the stablecoin lane over the dodge. President Trump posted on Truth Social at 12:15 a.m. ET on Jan. 13: "Everyone should support great Republican Senator Roger Marshall’s Credit Card Competition Act, in order to stop the out of control Swipe Fee ripoff." [6] Vice President JD Vance, then a senator from Ohio, was an original cosponsor of the 2023 version, S. 1838 [7][8]. Trump signed GENIUS [20]. Neither man has linked the two bills in any primary source Le Coin reviewed.

One distinction matters. A Visa card funded with a stablecoin still clears on Visa. Coinbase's card is a Visa debit card issued by Pathward, N.A.; it converts crypto to dollars for the purchase, and the merchant receives a Visa transaction [21]. Accepting that card does not let the merchant choose the rail.

Le Coin diagram: one $100 sale, three outcomes

Le Coin.Figure · Payments · A $100 sale

Three outcomes. Same $100 sale.

All dollar figures are illustrative. They are not forecasts or measured averages.

01 · Today

Card runs on Visa or Mastercard. Merchant has no choice of route.

Bank $2.20Network $0.50Merchant keeps $97.30

02 · Thesis · the bank is paid either way

Interchange if the sale stays on Visa or Mastercard. Distribution payments if it routes to the coin and the coin stays outstanding on the bank's platform.

Route A. Stays on the card

Bank $2.20Network $0.50Merchant keeps $97.30

Route B. Paid in the coin, and held

01 · Pays in coinMerchant

Paid in the coin, and holds it.

→

02 · Stays outstanding$99.50

Held in the coin, after a $0.50 network fee.

→

03 · Over timeIssuing bank

$0.00 from the sale. Paid while the coin stays.

Network fee $0.50Merchant holds $99.50

The bank's payment is a distribution from the coin's issuer on coins that stay on its platform. No figure. If the coin is sold or redeemed for dollars on arrival, that payment stops.

03 · Dodge · a second network built not to be used

A second network is enabled. The merchant refuses it, so every sale stays on Visa or Mastercard.

• Declines
• No online route
• Weak fraud checks
• Unclear chargebacks

Bank $2.20Network $0.50Merchant keeps $97.30

Source: Le Coin analysis. Illustrative figures. The $2.20 equals Visa's published 2.10% + $0.10 rate for a Visa Signature Preferred card at a card-present retail merchant (Retail Credit-Performance tiers), effective April 18, 2026 [16]. The $0.50 network/merchant-bank cost and the $0.50 stablecoin network fee are placeholders so each route adds to $100. Route B's $99.50 is the sale less that placeholder fee, held in the coin. No primary source cited here sets them. Reserve income stays with the coin's issuer [12][14]. The bank's Route B payment has no figure; a distribution contract would set it, and it accrues on coins held, not per sale.

What we don't know

It is not known whether the Senate Banking Committee will take up S. 3623; the record shows no action since referral [2]. The bill does not say how the Fed would judge whether a second credit network is usable [1]. No primary source shows a covered bank willing to take distribution payments on coins held in place of interchange, or the terms any issuer would offer a bank. No primary source shows how long merchants paid in a coin would keep it before redeeming it. And no primary source measures how often merchants would route to a stablecoin lane if one were offered.

Sources

Primary sources, numbered as cited. Access times are ET.

1. S. 3623, Credit Card Competition Act of 2026, introduced text (GovInfo, BILLS-119s3623is). https://www.govinfo.gov/content/pkg/BILLS-119s3623is/html/BILLS-119s3623is.htm (re-opened Oct. 9, 2026, 1:23 a.m. ET)
2. GovInfo bill status, S. 3623 (BILLSTATUS-119s3623). https://www.govinfo.gov/bulkdata/BILLSTATUS/119/s/BILLSTATUS-119s3623.xml (Oct. 9, 2026, 1:23 a.m. ET)
3. Congress.gov, S. 3623 text page. https://www.congress.gov/bill/119th-congress/senate-bill/3623/text/is (opened Oct. 9, 2026, 1:22 a.m. ET; returned a security check, so the bill was confirmed from [1] and [2])
4. Sen. Roger Marshall, "Marshall, Durbin Reintroduce Credit Card Competition Act Backed by President Trump," Jan. 13, 2026. https://www.marshall.senate.gov/newsroom/press-releases/marshall-durbin-reintroduce-credit-card-competition-act-backed-by-president-trump/ (Oct. 9, 2026, 1:22 a.m. ET)
5. Sen. Dick Durbin, "Durbin, Marshall Reintroduce The Credit Card Competition Act," Jan. 13, 2026. https://www.durbin.senate.gov/newsroom/press-releases/durbin-marshall-reintroduce-the-credit-card-competition-act (Oct. 9, 2026, 1:22 a.m. ET)
6. Donald J. Trump, Truth Social post, Jan. 13, 2026, 12:15 a.m. ET. https://truthsocial.com/@realDonaldTrump/115886085338434959 (Oct. 9, 2026, 1:22 a.m. ET)
7. S. 1838 (118th Congress), Credit Card Competition Act of 2023, introduced text (GovInfo). https://www.govinfo.gov/content/pkg/BILLS-118s1838is/html/BILLS-118s1838is.htm (Oct. 9, 2026, 1:22 a.m. ET)
8. Sen. Peter Welch, "Welch, Durbin, Marshall, and Vance Introduce Bipartisan Credit Card Competition Act of 2023," June 7, 2023. https://www.welch.senate.gov/welch-durbin-marshall-and-vance-introduce-bipartisan-credit-card-competition-act-of-2023/ (Oct. 9, 2026, 1:22 a.m. ET)
9. 15 U.S.C. § 1693o-2(c)(11), definition of payment card network (U.S. Code, 2024 ed.), as cited in cleared v6. https://www.govinfo.gov/content/pkg/USCODE-2024-title15/html/USCODE-2024-title15-chap41-subchapVI-sec1693o-2.htm (Oct. 8, 2026, 10:36 p.m. ET)
10. 12 CFR part 235 (Regulation II), § 235.7 and official commentary, eCFR, current as of Oct. 7, 2026. https://www.ecfr.gov/current/title-12/chapter-II/subchapter-A/part-235 (Oct. 9, 2026, 1:21 a.m. ET)
11. Federal Reserve Board, "Debit Card Interchange Fees and Routing," final rule, 87 FR 61217, Oct. 11, 2022 (FR Doc. 2022-21838). https://www.federalregister.gov/documents/full_text/text/2022/10/11/2022-21838.txt (Oct. 9, 2026, 1:21 a.m. ET)
12. Circle Internet Group, Form 10-Q for the quarter ended June 30, 2026 (Management's Discussion and Analysis: "Circle stablecoins and related reserve income" and "Distribution costs"). https://www.sec.gov/Archives/edgar/data/1876042/000187604226000248/crcl-20260630.htm (re-opened Oct. 9, 2026, 2:12 a.m. ET)
13. Circle Internet Group, Form 10-K for the year ended Dec. 31, 2025. https://www.sec.gov/Archives/edgar/data/1876042/000187604226000062/crcl-20251231.htm (re-opened Oct. 9, 2026, 2:12 a.m. ET)
14. Public Law 119-27, GENIUS Act, July 18, 2025 (GovInfo). Pin cites: § 2(22), payment stablecoin definition, 139 Stat. 421; § 2(23), permitted payment stablecoin issuer (including an approved subsidiary of an insured depository institution), 139 Stat. 422; § 3(a), permitted issuers only, 139 Stat. 423; § 4(a)(1)(A), 1-to-1 reserves including Treasury bills of 93 days or less, 139 Stat. 425; § 4(a)(11), prohibition on interest, 139 Stat. 432 (12 U.S.C. 5903(a)(11)). https://www.govinfo.gov/content/pkg/PLAW-119publ27/html/PLAW-119publ27.htm and https://www.govinfo.gov/content/pkg/PLAW-119publ27/pdf/PLAW-119publ27.pdf (re-opened Oct. 9, 2026, 2:12 a.m. ET); also cited in v6 at https://www.congress.gov/119/plaws/publ27/PLAW-119publ27.htm
15. Federal Reserve Board press release, Oct. 3, 2022. https://www.federalreserve.gov/newsevents/pressreleases/bcreg20221003a.htm (Oct. 9, 2026, 1:21 a.m. ET)
16. Visa, "Visa USA Interchange Reimbursement Fees," April 18, 2026. https://usa.visa.com/content/dam/VCOM/download/merchants/visa-usa-interchange-reimbursement-fees.pdf (Oct. 9, 2026, 1:22 a.m. ET)
17. Visa Inc., Form 10-K for the fiscal year ended Sept. 30, 2025, as cited in cleared v6. https://www.sec.gov/Archives/edgar/data/1403161/000140316125000089/v-20250930.htm (Oct. 8, 2026, 5:45 p.m. ET)
18. Mastercard Inc., Form 10-K for the year ended Dec. 31, 2025, as cited in cleared v6. https://www.sec.gov/Archives/edgar/data/1141391/000114139126000013/ma-20251231.htm (Oct. 8, 2026, 5:45 p.m. ET)
19. American Express Co., Form 10-K for the year ended Dec. 31, 2025, as cited in cleared v6. https://www.sec.gov/Archives/edgar/data/4962/000000496226000080/axp-20251231.htm (Oct. 8, 2026, 5:45 p.m. ET)
20. The White House, "Fact Sheet: President Donald J. Trump Signs GENIUS Act into Law," July 18, 2025. https://www.whitehouse.gov/fact-sheets/2025/07/fact-sheet-president-donald-j-trump-signs-genius-act-into-law/ (Oct. 9, 2026, 1:23 a.m. ET)
21. Coinbase Card product page (Visa debit; issued by Pathward, N.A.), as cited in cleared v6. https://www.coinbase.com/card (Oct. 8, 2026, 5:48 p.m. ET)

Also opened for verification, not cited in the text: Circle Internet Group Form 10-K/A for 2025 (adds Circle Reserve Fund financial statements only), https://www.sec.gov/Archives/edgar/data/1876042/000187604226000228/crcl-20251231.htm (Oct. 9, 2026, 1:22 a.m. ET); Congress.gov S. 1838 record, https://www.congress.gov/bill/118th-congress/senate-bill/1838/all-info (Oct. 9, 2026, 1:22 a.m. ET; returned a security check).

Holding the Corner.

Not financial advice.