Overview
- Coinbase told Senate offices this week it cannot support the newest CLARITY Act draft because it targets stablecoin rewards, according to multiple reports citing the company’s outreach.
- The circulating Senate text would prohibit yield offered “directly or indirectly” on stablecoins or deposit‑like assets, allow only activity‑based perks such as loyalty rewards, and assign regulators a year to define boundaries and anti‑evasion rules.
- Senators Thom Tillis and Angela Alsobrooks said on March 20 they had an agreement in principle with the White House to bar yield on passive balances, yet the Banking Committee has not scheduled a markup and reporting suggests staff could post updated text soon.
- The stakes are financial and political as banks warn of deposit flight, Circle’s shares fell about 20% after the ban language surfaced, and Coinbase defends a revenue stream of roughly $1.35 billion in 2025 tied to stablecoin returns shared with users.
- The fight widened to developer rules and next steps, with DeFi advocates seeking fixes so non‑custodial software builders are not treated like money transmitters and with the OCC’s separate GENIUS Act comment period poised to shape whether third‑party yield survives.