February 3 (Reuters) – A meeting at the White House aimed at breaking a months-long deadlock between the largest U.S. banks and cryptocurrency companies concluded on Monday without any agreement, highlighting ongoing disagreements within the industry that continue to threaten the advancement of important digital asset legislation.

The closed session, convened by the White House crypto council, brought together representatives from the crypto industry and the banking sector in an attempt to reach an agreement on the stalled crypto market structure bill. Both sides described the meeting as constructive, but fundamental disagreements that derailed the bill's progress remained unresolved.

Attendees included representatives from banking and crypto trade associations, including the American Bankers Association, Independent Community Bankers of America, Blockchain Association, and The Digital Chamber.

The legislation on the crypto market structure has been blocked due to a standoff between the two industries over how the bill regulates interest payments and other rewards on stablecoins, which has been a sticking point for several months. Banks insist on including language in the bill that prohibits such practices.

Cryptocurrency companies argue that offering rewards such as interest is crucial for attracting new customers, and that banning such activities would be anti-competitive. Banks contend that increased competition could lead to a withdrawal of deposits from insured lenders — the primary source of funding for most banks — potentially threatening financial stability.

The White House meeting on Monday was intended to find a compromise after the Senate Banking Committee postponed consideration of the bill last month amid growing objections from both sides and concerns that it lacks sufficient support to move forward in the full Senate.

Although both sides described the meeting as constructive, no agreement was reached, said one of the sources present at the meeting who wished to remain anonymous when discussing private political negotiations.

The source suggested that further meetings at the White House are planned to resolve the deadlock. The White House did not respond to a request for comment.

The Clarity Act bill proposes creating federal rules for digital assets, a result of years of lobbying by the crypto industry. Cryptocurrency companies have long argued that existing regulations are not suitable for digital assets and that legislative regulation is necessary for their continued operation with legal certainty in the U.S.

The House of Representatives passed its version of the bill in July.