U.S. Cryptocurrency Legislation Key Compromise Reached: Stablecoin Yield Terms Break the Ice, "Clarity Act" to Accelerate

Zhitong Finance APP 05-02 08:19
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After months of intense negotiations, major breakthroughs have finally been made in the structure legislation of the U.S. cryptocurrency market. Senator Thom Tillis and Angela Alsobrooks have reached a comprehensive agreement on the stablecoin yield provisions, clearing major obstacles for the advancement of the "Clarity Act" (CLARITY Act) in the Senate.

According to the obtained text, this compromise imposes significant restrictions on the rewards and returns offered by stablecoins. The agreement explicitly states that all reward mechanisms that are "economically or functionally equivalent to" bank deposit interest will be prohibited. This broad restriction aims to prevent stablecoins from directly competing with traditional bank savings products, responding to long-standing concerns from the banking industry about "deposit flight."

However, the agreement does not implement a blanket ban but retains considerable flexibility. Stablecoin balances can be used for reward mechanisms but must pass an "equivalence test." This means cryptocurrency companies can still offer incentives to users under certain conditions, but high-yield models that mimic bank interest structures will be blocked.

Coinbase Chief Policy Officer Faryar Shirzad confirmed this breakthrough on social media and revealed that the final text has been made public. He pointed out that after months of negotiations, Coinbase reached an agreement with the White House, the Treasury Department, and Senate officials. "In the end, the banking sector secured more restrictions on rewards, but we protected the most valuable thing — Americans’ ability to earn from crypto platforms and networks," Shirzad stated. In the current geopolitical environment, safeguarding U.S. leadership in financial innovation is crucial.

This compromise has become a key leverage point for legislative efforts to reshape the entire cryptocurrency market structure. The bill aims to delineate the regulatory authority of the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission over different areas of the digital asset ecosystem. With the resolution of the stablecoin yield issue, the legislative process is expected to accelerate. It is reported that significant progress has also been made in token classification, decentralized finance regulation, and asset tokenization, and the final text of the "Clarity Act" is expected to be finalized and submitted for a vote by the Senate Banking Committee soon.

Concerns from the banking industry that stablecoin yields might divert deposits have been a major sticking point causing legislative stagnation. The negotiated agreement not only grants the banking system stronger control but also preserves core customer acquisition and incentive spaces for the crypto industry, seen by the market as a pragmatic step toward clarifying U.S. crypto regulation.

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