A CLARITY Act compromise on stablecoin rewards may clear the way for a Senate Banking Committee markup in the week of May 11, while Circle shares rose 16% as markets viewed the outcome as supportive for user incentives.
The Digital Asset Market Clarity Act may move to a Senate Banking Committee markup in the week of May 11 after negotiators released compromise language on stablecoin rewards, the issue that had stalled the bill since January. The draft from Sens. Thom Tillis and Angela Alsobrooks would broadly prohibit rewards that are economically or functionally equivalent to interest on a bank deposit, shifting firms away from "buy and hold" incentives and toward "buy and use" models tied to real platform or network activity. Coinbase chief policy officer Faryar Shirzad said the compromise preserved consumers’ ability to earn rewards based on real use of crypto platforms and networks, while CCI questioned whether the prohibition could be too broad. Banks remain opposed, with the American Bankers Association and 52 state bankers’ associations urging the Office of the Comptroller of the Currency to block indirect yield through third parties under stablecoin rules. Separately, Circle shares rose 16% after the reported compromise, indicating investors viewed the development as supportive for stablecoin-related business models. While one source characterized the compromise as preserving stablecoin rewards, the legislative description indicates it preserves use-based rewards while barring rewards deemed equivalent to deposit interest.