Crypto Industry Supports CLARITY Act Compromise on Yield, 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. The Blockchain Association's CEO, Summer Mersinger, welcomed the deal as a step in the right direction, stating that the lack of a clear legal framework is driving top talent, capital, and innovative companies away. The Crypto Council for Innovation also endorsed the bill, but expressed concerns about the broad prohibition framework. The CEO of the Crypto Council for Innovation, Ji Hun Kim, urged the committee to advance the bill, citing the need for the US to lead in the crypto space. Circle's Chief Strategy Officer, Dante Disparte, also supported the compromise, highlighting the growth of USDC in cross-border payments, capital markets collateral, and commerce. Coinbase's 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 a markup of the CLARITY Act in January, but the yield language has been the major obstacle. To comply with the new rules, companies will need to restructure their rewards programs from a 'buy and hold' model to a 'buy and use' model.