Crypto Industry Supports Compromise on CLARITY Act, Urges Senate to Move Forward

Within hours of US Senators Thom Tillis and Angela Alsobrooks releasing a compromise text on stablecoin yield in the Digital Asset Market Clarity Act, crypto trade groups called for a markup of key market structure legislation. The proposed text prohibits crypto firms from paying interest or yield on stablecoin balances in a manner similar to a bank deposit, while allowing rewards programs tied to legitimate activities or transactions. The agreement directs Treasury and the CFTC to establish rules within a year of enactment. Industry leaders, including Blockchain Association CEO Summer Mersinger and Circle Chief Strategy Officer Dante Disparte, have expressed support for the compromise, viewing it as a step towards creating a clear legal framework for the crypto industry. However, the Crypto Council for Innovation has raised concerns that the new language extends the prohibition framework too far, applying to all digital asset market participants. Despite these concerns, the council has urged the Senate Banking Committee to advance the bill, emphasizing the importance of US leadership in the crypto space. The compromise has also received support from Coinbase, with CEO Brian Armstrong and Chief Legal Officer Paul Grewal welcoming the preservation of activity-based rewards. To comply with the proposed regulations, firms will need to restructure their rewards programs from a 'buy and hold' model to a 'buy and use' approach, focusing on genuine participation and transactions.