Veteran financial advisor Ric Edelman says the crypto industry may need to compromise in the debate over yield-bearing stablecoins, warning that the powerful banking lobby is likely to prevail in Washington.

In an interview with Jennifer Sanasie on CoinDesk’s Markets Outlook, Edelman said the question of whether stablecoins should be allowed to offer yield has become a key obstacle in advancing broader crypto market structure legislation. The dispute has emerged as a sticking point in negotiations around the proposed Clarity Act.

Banking groups have strongly opposed the idea of yield-generating stablecoins, arguing that such products could pull deposits away from traditional banks. Edelman said the pushback largely reflects concerns within the banking industry that stablecoins could undermine their existing business models.

Although Edelman agrees with crypto proponents on the economic logic behind yield-bearing stablecoins, he believes the political influence of the banking sector means it will probably win the policy fight.

Why it matters

Edelman argues that the crypto industry should not jeopardize broader regulatory progress over this single issue.

“I don’t think it’s the hill to die on,” he said of the battle over stablecoin yield.

Passing comprehensive market structure legislation, he noted, would provide long-awaited regulatory clarity for both crypto firms and investors. Prediction markets currently suggest the bill has a strong chance of passing, though the timeline remains uncertain.

However, Edelman warned that the legislation could stall if it is not approved before the next midterm elections.

Market outlook

Edelman believes that clearer rules could provide a major boost to the crypto market.

If the bill ultimately fails, he expects a sharp but temporary decline in digital asset prices as investors react to the setback. Over the longer term, however, he still sees the sector expanding — though at a slower pace without supportive legislation.

If the measure is passed, Edelman predicts the market could rally quickly and push prices to new record highs. He reiterated his long-term forecast that Bitcoin could reach $500,000 by the end of the decade.

Reading between the lines

Edelman also pushed back against concerns that advances in quantum computing could threaten bitcoin’s security.

He dismissed claims that quantum machines could break the bitcoin blockchain, arguing that the industry would develop stronger cryptographic defenses alongside any technological breakthroughs.

Even if powerful quantum computers eventually emerge, Edelman suggested attackers would likely focus on larger financial systems or critical infrastructure before targeting bitcoin.

He continues to recommend that investors allocate as much as 40% of their portfolios to crypto assets, focusing primarily on leading tokens such as bitcoin, Ethereum and Solana.

Looking ahead

As the digital asset industry matures, Edelman expects consolidation among cryptocurrencies. In his view, roughly a dozen major tokens will ultimately dominate the sector.

At the same time, he believes tokenization could dramatically expand the number of blockchain-based assets, potentially creating hundreds of thousands of tokens tied to real-world assets such as real estate, commodities and collectibles — significantly increasing diversification opportunities for investors.