The CLARITY Act is again facing another setback with Coinbase, a major crypto stakeholder, opposing the latest version of the stablecoin yield compromise. This comes as crypto leaders are reportedly divided over the stablecoin yield deal, which they term as being “restrictive.”
CLARITY Act Suffers Setback as Coinbase Opposes Stablecoin Deal
According to Punchbowl News, Coinbase has informed Senate offices that it could not support the latest version of the stablecoin yield compromise. This represents a setback given Coinbase’s role in shaping crypto policies so far.
It is worth noting that the crypto exchange had opposed a prior version of the CLARITY Act due to the stablecoin yield provision in January, when the Senate Banking Committee scheduled a markup of the crypto bill. The committee ultimately postponed the markup amid opposition from Coinbase and other crypto stakeholders.
This stablecoin rewards issue remains a key obstacle in the crypto bill’s progress. There was optimism last week after reports that the White House had reached a deal with key Senate leaders, Senators Thom Tillis and Angela Alsobrooks, to settle the clash between the banking and crypto industries over the stablecoin yield provision.
However, that optimism is quickly fading again as crypto stakeholders, including Coinbase, disagree with the bill’s latest version. As CoinGape reported, crypto leaders had described the stablecoin yield text language in the CLARITY Act as “restrictive.”
The provision places a broad ban on stablecoin rewards, limiting the payment of yield to activity-based rewards that are not equivalent to bank deposit interest. A crypto stakeholder had also noted that the latest draft was different from what both sides had previously discussed with the White House. They added that some provisions are vague and that future regulators could interpret them more restrictively.
These latest developments with the CLARITY Act have also sparked a bearish sentiment in the market. Notably, crypto stocks COIN and CRCL suffered significant crashes yesterday as the yield provision could negatively impact Coinbase and Circle’s revenue.
Crypto Leaders Divided Over The Bill
According to a Crypto in America report, crypto policy leaders are split over the latest stablecoin yield language, which largely limits yield payment to just activity-based rewards. An industry conference call between representatives from crypto exchanges, fintechs, and venture capital firms reportedly took place yesterday over the draft text, during which some called it unworkable while others defended it.
This followed the review of the latest text by crypto representatives who went to Capitol Hill on Monday. Meanwhile, as CoinGape reported, banking representatives reviewed the latest CLARITY Act text yesterday.
A banking representative who reviewed the text told Crypto in America that the stablecoin language appears to reflect the compromise that the senators and the White House set out to achieve. The Senate has yet to release the latest draft, but it could become public as early as today, according to Crypto in America.
With key stakeholders opposing the latest draft text, crypto traders are again paring their bets on U.S. President Donald Trump signing the crypto bill into law this year. Polymarket data show a 61% chance of the bill passing this year, down from 71% about five days ago.
Source: PolymarketSource: https://coingape.com/clarity-act-faces-setback-as-coinbase-opposes-stablecoin-yield-compromise/
