CLARITY Act Enters a Critical Window: U.S. Senate Reassembly and the Battle over Stablecoin Yield Distribution

On April 13, 2026, the U.S. Senate ended its two-week Easter recess and fully resumed legislative activities. Meanwhile, a piece of legislation that had been dormant for months in the crypto industry was brought back into the spotlight—The 2025 Digital Asset Market Clarity Act (CLARITY Act). A week prior, U.S. Treasury Secretary, crypto industry leaders, and several active lawmakers issued strong statements, pressuring Congress to accelerate the legislative process. This marks the most critical window for Senate review since the bill was passed with a high vote in the House of Representatives in July 2025. In this legislative battle, the profit distribution mechanism for stablecoins has become a core point of contention, and its outcome may directly determine the bill’s final fate.

Legislative Sprint: Senate Reassembly and Multi-Party Pressure

On April 13, 2026, the U.S. Senate concluded its Easter recess and resumed full sessions. The 2025 Digital Asset Market Clarity Act entered the final sprint of the Senate legislative process. The Senate Banking Committee plans to hold a markup session in the latter half of April to review, amend, and vote on the bill. If approved by the committee, the bill will proceed to full Senate consideration.

Procedurally, the bill must go through five key steps: Senate Banking Committee markup, a 60-vote majority in the full Senate, coordination with the Agriculture Committee version, reconciliation with the House’s July 2025 version, and finally, delivery for presidential signature. Alex Thorn, head of Galaxy Research, pointed out that if the bill fails to pass committee review in April, the likelihood of completing legislation within 2026 will drop to an “extremely low” level.

Multiple forces continue to ramp up efforts to push the bill forward. U.S. Treasury Secretary Janet Yellen urged Congress to pass the bill. Coinbase CEO Brian Armstrong publicly expressed support for the bill on April 10, stating, “It’s time to pass the CLARITY Act,” marking a shift from his opposition stance in January. Meanwhile, Circle’s stock price rose 12.09% on April 13, reflecting market optimism about legislative progress.

Retrospect and Deadlock: From High Vote Passage to Senate Standoff

On July 17, 2025, the CLARITY Act was passed in the House with a high vote of 294 in favor and 134 against. Notably, 78 Democratic lawmakers voted in favor, far exceeding previous bipartisan support levels for similar bills. On the same day, the GENIUS Act was officially signed into law by the President, establishing a federal regulatory framework for USD-backed payment stablecoins. The CLARITY Act, along with the “Anti-CBDC Surveillance State Act,” was then handed over to the Senate.

After the House approval, markets were optimistic that the bill would complete Senate review before Thanksgiving 2025. However, ongoing disputes over the profit payment mechanism for stablecoins caused delays in the Senate Banking Committee’s review. In January 2026, the scheduled markup was canceled, and the legislative process stalled. That month, data from Bitwise showed the probability of the CLARITY Act passing in Polymarket dropped from 80% to 50%, reflecting industry concerns about its prospects.

A turning point occurred in mid-March 2026 when Senators Thom Tillis (Republican) and Angela Alsobrooks (Democrat) reached a principled agreement with the White House on stablecoin profit issues, breaking months of deadlock. Patrick Witt, Executive Director of the White House’s Digital Asset Advisory Committee, stated that negotiations were nearing completion, with several disagreements close to resolution.

The current legislative window is extremely tight. The Memorial Day recess begins on May 21. If the bill does not make significant progress in the Senate before then, the legislative process may fall into the midterm election political cycle. As scholar Sun Yuanzhao analyzed, if the bill cannot pass before the summer recess (by August), “it is very likely to die in the cradle.”

Data Perspective: Vote Structure, Market Size, and Expectation Fluctuations

Currently, the U.S. Senate has 53 Republican and 47 Democratic seats (including 2 Independents). Important bills typically require at least 60 votes to overcome procedural hurdles. This means that, assuming all Republicans vote in favor, 7 to 10 Democrats must cross party lines to support. Historical precedent: the GENIUS Act was passed in the Senate in June 2025 with a vote of 68-30, garnering broad bipartisan support. If the CLARITY Bill can maintain similar cross-party consensus, the 60-vote threshold is not insurmountable.

As of April 2026, the total global stablecoin market cap has reached approximately $318.6 billion, more than doubling from about $125 billion at the start of 2024. The mid-2025 enactment of the GENIUS Act provided a federal regulatory framework for payment stablecoins, directly fueling explosive growth in institutional adoption. Citigroup predicts that, under a clear regulatory path, the global stablecoin market could grow from $230 billion in 2025 to $1.6 trillion by 2030.

Market prediction platforms like Polymarket have shown significant volatility in the probability of the CLARITY Act being signed into law in 2026: from a high of 80% in early January, it fell to 50%, then rebounded to 72% after White House efforts in March, and has been oscillating between 63% and 66% in early April. Notably, a study from Columbia University indicates that about 25% of trading volume on Polymarket may involve wash trading, so its probability data should be interpreted with caution.

Based on Gate.io data, as of April 14, 2026, Bitcoin is priced at $74,440.7, with a 24-hour trading volume of $16k, a market cap of $1.33 trillion, and a 24-hour price change of +4.86%. Ethereum is at $2,365.16, with a 24-hour trading volume of $13.3k, a market cap of $271.24 billion, and a 24-hour change of +7.78%. The market rebound and the warming of legislative expectations coincide closely, reflecting the significant influence of regulatory outlooks on digital asset prices.

Core Battleground: Positions and Compromises on Stablecoin Profit Distribution

U.S. banking industry advocates continue lobbying Congress to prohibit stablecoin firms from offering interest-like passive yields. The core concern is that allowing “passive income” could divert traditional bank deposits, impacting their primary funding source for loans to households and businesses. The American Bankers Association remains cautious about the negotiated compromise, responding on April 14 that the White House’s related report has flaws and insisting that stablecoin yields could pose risks to community banks.

Crypto firms argue that incentives linked to payments, wallet usage, or network activity are vital tools for competing with traditional payment channels. For Circle, the wording differences in the final CLARITY bill will directly impact its valuation and business model. Market estimates suggest Coinbase’s stablecoin-related revenue accounts for about 20% of total revenue, and its stance shift largely stems from confirmation of retaining incentive provisions.

A White House Economic Advisory Council report released on April 8 concluded that a comprehensive ban on passive yields offers limited actual protection for bank deposit stability—providing a political basis for a compromise. The report states that the proposed ban on stablecoin yields would only increase U.S. bank loans by about $2.1 billion, a mere 0.02% increase, thus weakening the lobbying argument from a data perspective.

The current bipartisan Tillis-Alsobrooks compromise framework centers on: prohibiting crypto platforms from paying interest on stablecoin holdings, but allowing activity-based incentives and rewards tied to payment behavior and platform use. Patrick Witt called this a “major milestone,” emphasizing that resolving stablecoin yield issues is a prerequisite for advancing the entire bill.

Narrative Analysis: Probabilities, Substitutes, and Reconsidering Position Shifts

When interpreting market information, caution should be exercised regarding these key narratives:

First, Polymarket’s predicted probabilities are useful indicators of market expectations but, as Columbia University research shows, about 25% of trading volume may involve wash trading, so these probabilities should not be taken as purely scientific forecasts.

Second, the narrative that the banking sector’s concern over stablecoin yields will massively divert deposits differs significantly from the White House’s “only 0.02% increase in bank loans” conclusion. This data discrepancy highlights the need to distinguish between political lobbying narratives and empirical data when understanding the controversy.

Third, Coinbase’s shift from a January stance of “prefer no bill than a bad bill” to publicly endorsing in April can be seen as acceptance of a compromise. However, given that stablecoin revenue accounts for about 20% of its total business, this position change clearly involves commercial interests.

Structural Impact: How Passing the Bill Will Reshape the Crypto Industry

If the CLARITY Act passes successfully, its most profound impact will be the clear delineation of jurisdiction between the SEC and CFTC. The bill would transfer primary oversight of spot crypto trading to the CFTC, resolving long-standing regulatory overlaps. Compared to the Biden administration’s SEC-led aggressive enforcement, this shift could significantly reduce compliance uncertainty for crypto firms.

Alex Thorn of Galaxy Research noted that if the bill passes, it would become a major bullish catalyst for cryptocurrency adoption. Bitwise also predicts that, should a workable version of the CLARITY Act pass, the market will rebound sharply, as investors will immediately price in the expanded certainty for blockchain finance.

The final wording of the profit provisions in the CLARITY Act will directly influence the business models of stablecoin firms like Circle and Coinbase. If the Tillis-Alsobrooks compromise is codified into law, Circle could maintain an incentive ecosystem based on USDC usage, attracting institutional and retail users. Conversely, if the banking sector successfully narrows the scope of activity incentives at the final stage, Circle’s revenue structure could face direct compression.

Long-term, the continued growth of digital asset management depends on clear regulatory frameworks. If the CLARITY Act fails, Benchmark analysts believe the U.S. crypto market will face “structural constraints,” and large-scale institutional capital inflows will be significantly hindered.

Path Scenarios: From Smooth Passage to Re-Delays in Four Legislative Outcomes

Scenario 1: Bill Passes Smoothly

Assumption: The Senate Banking Committee approves the markup in late April, bipartisan consensus on stablecoin profit clauses is reached, and the full Senate votes with over 60 votes. At this point, the U.S. crypto regulatory framework will be largely established, forming a “GENIUS + CLARITY + Anti-CBDC” three-layer structure. Institutional capital accelerates inflow, and stablecoin market size could surpass $400 billion in late 2026, with market confidence significantly restored.

Scenario 2: Further Delay Until After Midterm Elections

Assumption: The late-April markup achieves limited progress but fails to reach final approval, prolonging the legislative process amid political struggles. During this period, the crypto industry continues to face regulatory uncertainty. Bitwise’s “three-year window” logic is activated: if the bill fails, the industry must push for large-scale adoption of stablecoins and tokenized assets to compel regulation.

Scenario 3: Bill Rejected in the Senate

Assumption: Disputes over stablecoin profit sharing intensify at the final stage, key Democratic senators withdraw support, and the bill fails to reach the 60-vote threshold. Short-term market sentiment will suffer, with possible significant corrections in digital asset prices. In the longer term, the industry may evolve along two paths: Congress drafts a simplified market structure bill, or it seeks incremental development within the existing legal framework based on the GENIUS structure.

Scenario 4: Bill Passes with Amendments

Assumption: The Senate passes a version that significantly amends the House version, especially on profit clauses and DeFi developer protections, making more concessions. This is the most likely scenario. The final version may retain the Tillis-Alsobrooks compromise on stablecoin profit clauses. Market impact will be between scenarios one and two—short-term positive effects from regulatory certainty may be offset by some compromises, but long-term legal infrastructure will still support institutional entry.

Conclusion

The Senate review of the CLARITY Act is not just about passing a law; it marks a key turning point in the shift of U.S. crypto regulation from “enforcement-driven” to “legislation-driven.” The passage of the GENIUS Act in 2025 proved that bipartisan consensus on crypto legislation is possible. Whether the CLARITY Act can sustain this momentum will be revealed in the coming weeks.

The dispute over stablecoin profit distribution on the surface is a battle of interests between banks and crypto firms, but at a deeper level, it reflects the power struggle over regulatory authority between the digital asset financial system and traditional banking. Regardless of the outcome, this legislative process has profoundly changed the policy ecosystem for the U.S. crypto industry. For market participants, understanding each step of the legislative process is far more valuable in the long run than short-term price fluctuations.

As the regulatory framework gradually clarifies, the digital asset market is undergoing a structural transformation from “wild growth” to “orderly development.” The ultimate picture of this transformation will unfold through the strategic contest among the Senate, House, and White House.