US Crypto Market Structure Bill Depends on Senator Thom Tillis

• The US crypto market structure bill now hinges on Senator Thom Tillis’ support.
• The White House sent revised bill text to Tillis after weeks of talks with banks and crypto firms.
• Dispute over stablecoin yield rewards remains the main obstacle to the bill.

The progress on a major US cryptocurrency market structure bill now rests largely on the position of Senator Thom Tillis. The White House recently shared updated legislative text with Tillis’ office after weeks of negotiations involving crypto companies and banks.

Sources familiar with the discussions say recent meetings between Tillis, industry representatives, and White House officials are moving forward and may help push the bill back toward a Senate Banking Committee review.

Even without Democratic support, the bill could still advance through the committee if Republicans vote along party lines. However, Tillis’s vote remains critical for advancing the legislation, as pointed out by Eleanor Terrett. 

Industry participants say the next few weeks will determine whether the committee can schedule another markup before the end of March.

Stablecoin Yield Dispute Slows Progress

The biggest obstacle remains a dispute over stablecoin yield programs. The legislation, widely known as the CLARITY Act, aims to create a defined regulatory framework for digital assets in the United States.

Market participants argue the bill would remove regulatory uncertainty that has slowed growth across the crypto sector. Banks have pushed lawmakers to block crypto firms from offering yield rewards on stablecoins. 

Financial institutions argue that allowing stablecoin yields could pull deposits away from traditional bank accounts. Analysts estimate that stablecoins could divert up to $500 billion in bank deposits by 2028.

Crypto firms disagree. Companies such as Coinbase argue that banning rewards would limit innovation and prevent digital asset platforms from competing with traditional financial products.

Earlier in January, amendments from Senator Tillis and Senator Angela Alsobrooks sought to restrict stablecoin reward programs. Coinbase later cited those proposals as one of the reasons it withdrew support for the bill at the time.

White House Attempts to Broker Compromise

The White House has attempted to break the deadlock. Officials proposed a compromise that would allow stablecoin rewards only in limited situations.

Under the proposal, rewards could be tied to specific activities rather than passive holdings.

Crypto companies might accept this compromise. However, banks remain opposed. They argue that even limited yield incentives could trigger deposit outflows from the traditional banking system.

President Donald Trump has publicly criticized the banking sector during the negotiations. He said financial institutions should reach a deal with the crypto industry instead of blocking the legislation.

Related: JPMorgan Sees Mid-Year Approval for U.S. Crypto Market Bill