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

Within hours of the release of a compromise text by US Senators Thom Tillis and Angela Alsobrooks on stablecoin yield in the Digital Asset Market Clarity Act, crypto trade groups called for the Senate Banking Committee to move forward with the markup of the key market structure legislation. The compromise text prohibits crypto firms from offering interest or yield on stablecoin balances in a manner similar to traditional bank deposits. However, it does allow for rewards programs tied to legitimate activities or transactions, and directs the Treasury and the CFTC to establish rules within a year of enactment. The Blockchain Association's CEO, Summer Mersinger, welcomed the deal as a step in the right direction, stating that the absence of a clear legal framework poses a risk of driving top talent, capital, and innovative companies away. The Crypto Council for Innovation also endorsed the bill, while expressing concerns that the new language extends the prohibition framework too far. The CEO of the Crypto Council for Innovation, Ji Hun Kim, urged the committee to advance the bill, emphasizing the importance of ensuring the US leads in the crypto space. Circle's Chief Strategy Officer, Dante Disparte, endorsed the deal without reservation, highlighting the progress made in the CLARITY Act negotiations. Coinbase CEO Brian Armstrong and Chief Legal Officer Paul Grewal also expressed support for the language, which preserves activity-based rewards tied to real participation on crypto platforms. The Senate Banking Committee had previously postponed an earlier markup of the CLARITY Act in January, but the yield language has been the main obstacle. To comply with the new rules, firms will need to restructure their rewards programs from a 'buy and hold' model to a 'buy and use' model.