Crypto companies urge Congress to advance CLARITY Act after stablecoin rewards compromise
Updated
Updated · CNBC · May 4
Crypto companies urge Congress to advance CLARITY Act after stablecoin rewards compromise
16 articles · Updated · CNBC · May 4
Coinbase and other firms want Senate Banking Committee action as soon as next week after senators proposed banning holding-based rewards but allowing incentives when stablecoins are spent or used.
The compromise aims to break a bank-crypto deadlock over deposits and lending, and Tim Scott said the committee is nearing consensus on a bipartisan markup in May.
Banking groups still say the language is too weak, while some Democrats want further changes, leaving the bill's committee vote timing and bipartisan support uncertain despite White House backing.
Beyond stablecoins, how will the CLARITY Act redefine the entire U.S. digital asset landscape?
How will regulators draw the line between permissible 'usage rewards' and banned 'interest' on stablecoins?
Are stablecoins a genuine threat to the banking system, or a technological leap in financial services?
Stablecoin Yield Ban Lifted for Activity-Based Rewards in Pivotal CLARITY Act Compromise
Overview
In early May 2026, Senators Thom Tillis and Angela Alsobrooks, with White House support, brokered a bipartisan compromise resolving a long-standing deadlock over stablecoin yields. The agreement banned passive interest payments on stablecoins but allowed activity-based rewards tied to real usage like payments and trading. This breakthrough, supported by a White House economic analysis that debunked banking concerns, led major crypto firms like Coinbase and Circle to endorse the CLARITY Act. Despite ongoing opposition from banking lobbyists and unresolved issues around DeFi developer protections, the compromise cleared the way for a critical Senate markup scheduled for mid-May. This progress also contributed to a surge in Bitcoin prices amid growing regulatory optimism and global competition.