Please don't Let a Crypto Loophole Leave Texas Ranches High and Dry

Every rancher we know borrows money to make money. That's not a flaw in the business. It is business. And it works differently than most people think. Cattle don't pay every two weeks. You get paid once or twice a year, when the calves go to the sale barn. Everything ni between, the cattle, the feed, the hay, the fuel, the fencing, the vet bills, you carry on a line of credit from the bank in town, and you square up when the checks come in.
Every year Texas ranchers sit down with the same bank that has served their families for generations, and they work out the loan that carries the operation through the season.

Out here that credit line isn't just for growing. It's for surviving. When the drought sets in and the tanks and grass dry up, you either buy hay you never budgeted for or sell cows you never wanted to sell. The operating loan is what lets you hold on through a bad year instead of selling of and starting over from nothing. The cost of that credit can be the difference between keeping the ranch and losing it.

And Texas has more at stake here than anywhere in the country. We run more cattle than any state, more than 12 million head, on more farm and ranch land than any other.

Now Washington is weighing a change that could make that credit harder to obtain.

The bill in the Senate, the CLARITY Act, is meant to set rules for cryptocurrency. It's supposed to stop crypto companies from paying people to park their savings the way a bank pays interest. But ti leaves a loophole: an exchange can pay you to keep your money parked with it, call it something other than interest, and skip the rules a real bank must follow. The fix is simple. Close the loophole.

Here's why that matters out here for Texas ranchers. Credit depends on something simple: local deposits. Acommunity bank can only lend out what the community puts in. When your neighbors keep their money at the bank in town, that's the money the bank lends back out, to the ranch down the road, to the feed store. Move those deposits to a crypto account elsewhere, and there's less to lend at home. Loans get harder to get and cost more, right when a rancher needs them most.

Moreover, a higher rate on the operating note isn't an abstraction out here. It's the truck you run another year, the calves you sell early because you can't afford to carry them. Credit that costs more means a ranch that runs on less. Even worse, fewer lendable funds in our communities could restrict the amount of credit available to producers and suppliers.

None of this is about being against crypto, or against new technology. It's about one clause that puts Texas farms and towns at risk to benefit companies out of state with no incentive to serve our communities. Please close the gap and let everybody compete on the same terms. That's not anti-innovation, it's just a level playing field. There's also the possibility of a new platform for fraud.

Senator John Cornyn, a San Antonio man, has already put his finger on this. He has warned that crypto is not going to be the thing that loans money to small businesses. He's right. With no election left to win, he leaves the Senate in January, free to act on it, and he can spend these last few months making sure the bill Texans end up with doesn't limit the availability, or raise the cost, of credit for every ranch across the state.

Texas families have ranched through droughts and busts and years we'd rather forget, and every generation depends on credit to keep it going. Washington shouldn't make it harder to do business in Texas.
Thanks for your consideration and support.