CLARITY Act Latest Draft: Prohibits Earning Yields Solely for Holding Stablecoins

Goldfinch Finance reports that on March 24th, according to CoinDesk, industry professionals in the crypto sector saw for the first time the latest provisions regarding stablecoin yields in the revised version of the Senate’s “Digital Asset Market Clarity Act” during a closed-door hearing at Capitol Hill in Washington. The initial impression is that the language is too narrow and unclear. The new provisions were released last Friday by Senators Angela Alsobrooks and Thom Tillis. According to a person familiar with the current draft, the new provisions would prohibit earning yields solely by holding stablecoins, restrict practices that equate such plans with bank deposits, and impose further restrictions on other potentially permissible activities, while the specific criteria for activity-based stablecoin rewards remain unclear.

This compromise stems from lobbying battles between the crypto industry and the banking sector: banks insist that stablecoin rewards should not resemble interest-bearing bank deposits, arguing that such competing products could harm banks and suppress lending. The final compromise allows reward programs based on user stablecoin activity but prohibits rewards based on balances.

This closed-door hearing aims to push the Senate Banking Committee to schedule a hearing, marking an important step toward a full Senate vote on the bill. A similar version of the “Clear Act” was passed by the House last year, and another version cleared the markup process in the Senate Agriculture Committee. However, the bill still faces obstacles: parties need to reach consensus on a DeFi regulatory framework, and Democrats insist on including a clause that prohibits senior government officials from profiting personally from the crypto industry, which explicitly targets President Trump. (East New Agency)