By Paul LaFollette, Contra Costa County Farm Bureau Board Member
I start most mornings the same way: checking the fields, watching the weather, and running the numbers in my head. Farming in the East County leaves little room for error. One late rain, one broken pump, or one delayed shipment can throw an entire season off course. When that happens, the first call isn’t to a tech platform or a national lender. It’s to a local banker who knows my operation, my land, and the realities of farming here.
Across Contra Costa County, from Brentwood and Concord to Byron and Oakley, community banks are woven into rural life. They help farmers manage cash flow, finance long-term equipment, and weather downturns from drought, market swings, and rising input costs. These banks don’t just hold deposits. They help keep farms, jobs, and small towns afloat.
Community banks are owned and operated in our towns. Their deposits come from neighbors, families, and farmers who trust them to safeguard savings and reinvest locally. That stable deposit base allows banks to lend throughout the region. But now, that stability is being tested by new laws and financial technologies not designed with rural banking in mind.
I’m particularly concerned about a loophole in the recently passed GENIUS Act, which regulates stablecoins, digital assets tied to the U.S. dollar or Treasury securities. While Congress barred issuers from paying interest, the law does not clearly prohibit third-party platforms or affiliates from offering rewards tied to stablecoin holdings.
That loophole matters. It allows crypto platforms to advertise “high reward” stablecoins, competing directly with community banks that operate under stricter regulations. But stablecoins aren’t banks. The U.S. Treasury estimates this gap could expose up to $6.6 trillion in potential deposit outflows from regulated banks.
When deposits leave community banks, the impact is immediate. Deposits fuel loans and if stablecoins can earn interest then $1.3 trillion in community bank deposits are at risk, which would lead to a $850 billion decline in lending. In rural communities, that means fewer operating loans, delayed equipment purchases, and less investment in land or water efficiency. These aren’t abstract shifts. They hit farms and families directly.
From my vantage point as a farmer, the risk is clear. If people chase the highest advertised “reward,” community banks lose the stable funding they need, pushing farmers toward distant lenders with higher costs and less flexibility.
That’s a loss we can’t afford.
Community banks finance projects larger institutions won’t touch: irrigation upgrades, barn expansions, and value-added agriculture. They know our soil, climate, and risks. Undermining them undermines Contra Costa County’s rural economy.
Congress still has time to fix this. I call on Senators Adam Schiff and Alex Padilla to urge their colleagues on the Senate Banking Committee to ensure stablecoins cannot be marketed with interest- or reward-like incentives. We must protect deposit stability and keep local capital where it belongs.
Smart innovation and responsible regulation can coexist. But protecting rural communities means recognizing that not all regions absorb financial shocks equally. In Contra Costa County, strong local banks aren’t just about finance. They’re about preserving our ability to farm, employ neighbors, and sustain the region for the next generation.