New Clarity Act Text Allows Crypto Firms to Offer Stablecoin Rewards with Certain Conditions

A newly proposed agreement has been released, addressing the contentious issue of stablecoin yield in the crypto market structure legislation. The new text, part of the Digital Asset Market Clarity Act, prohibits stablecoin issuers from offering yield solely based on holding stablecoin reserves, as this may be seen as competing with traditional banking services. However, it allows for rewards tied to real participation and activity on crypto platforms, similar to those offered by financial firms for credit card activity. The restriction does not apply to incentives based on bona fide activities or transactions, but does apply to loyalty programs. The text also includes anti-evasion language and directs regulators to launch a rulemaking process to clarify how crypto firms can offer yield products. This development is seen as a step forward in the legislation, with crypto companies and trade associations welcoming the progress and advocating for the importance of rewards in driving innovation and consumer utility.