Senate Talks Advance on Clarity Act Stablecoin Rules

TLDR

• Sen. Thom Tillis plans to release draft language this week to resolve the Clarity Act stablecoin yield dispute.
• Tillis and Sen. Angela Alsobrooks have worked together to finalize updated provisions for the bill.
• The Senate Banking Committee has stalled the Clarity Act since January 2026 over yield restrictions.
• The draft bans passive yield on stablecoins but allows activity-based rewards tied to transactions and payments.
• The SEC, CFTC, and Treasury must define permitted reward structures within 12 months of enactment.

Sen. Thom Tillis plans to release draft language this week to address a dispute over stablecoin yield rules. He has worked with Sen. Angela Alsobrooks to finalize provisions for the Digital Asset Market Clarity Act. The effort seeks to break a Senate Banking Committee deadlock that has stalled the bill since January 2026.

Clarity Act Talks Focus on Stablecoin Yield Limits

Tillis, a North Carolina Republican, has negotiated with Maryland Democrat Angela Alsobrooks on updated bill language. Both lawmakers aim to settle disagreements over yield payments tied to stablecoins. The Senate Banking Committee has delayed action on the measure since early 2026.

Stablecoins such as USDT and USDC track the U.S. dollar and support trading and payments. The sector currently holds a market value of about $321 billion. Lawmakers have debated how platforms should handle rewards on idle balances.

The GENIUS Act of 2025 bars stablecoin issuers from paying yield directly. However, the current dispute centers on third-party platforms like Coinbase and other exchanges. These firms want flexibility to offer rewards linked to user activity.

A private draft circulated to industry representatives in early April. The draft bans passive yield paid solely for holding stablecoins. However, it allows activity-based rewards tied to transactions or payments.

The proposal directs the SEC, CFTC, and Treasury to define acceptable reward structures. The agencies must also craft anti-evasion rules within 12 months of enactment. Lawmakers continue to debate the exact definitions for qualifying activity.

Banking Groups and Crypto Firms Clash Over Rewards

Banking trade groups argue that the yield on stablecoins could pull funds from savings accounts. They warn that deposit flight could disrupt the traditional banking system. They also claim platforms would offer bank-like products without equal oversight.

Crypto companies reject those claims and call restrictions harmful to competition. Coinbase withdrew support for earlier drafts due to strict yield limits. The exchange has urged lawmakers to permit incentives tied to platform engagement.

Banking groups have raised fresh objections to the latest draft. However, they have not publicly detailed their concerns. Lawmakers continue to weigh those positions before scheduling a markup.

The Senate returned from Easter recess on April 13. Senate Banking Committee Chairman Tim Scott has targeted a markup session for late April. However, the committee has not set a formal date.

Other issues remain under discussion in the broader bill. Lawmakers continue to debate DeFi provisions and ethics rules for government officials. They have also considered adding measures related to community bank deregulation.

If the Senate does not move the bill by May, it could slip past the 2026 midterm elections. Prediction market Polymarket assigns a 59% chance of passage this year. That figure has fallen from above 82% earlier in 2026.

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