New Legislation Allows Crypto Companies to Offer Stablecoin Rewards with Certain Conditions

A newly released section of the proposed Digital Asset Market Clarity Act reveals that stablecoin issuers are banned from offering yield based solely on holding stablecoin reserves. However, the legislation permits rewards for 'bona fide activities or bona fide transactions', allowing crypto firms to offer incentives for genuine participation on their platforms. This approach is similar to rewards offered by financial firms for credit card activity. The restriction does not apply to incentives based on real transactions, but does apply to loyalty programs or similar efforts. The new text also includes anti-evasion language and directs the Treasury Department and Commodity Futures Trading Commission to launch a rulemaking within a year of the bill becoming law to clarify how crypto firms can offer yield. This development is seen as a positive step towards resolving one of the final issues standing in the way of the Committee's markup, with trade associations and crypto companies welcoming the public release of the stablecoin yield language.