US Senate Reaches Compromise on CLARITY Act Yield Rewards

The CLARITY Act, a bill governing digital asset market structure in the US, has made significant progress with the final text now public. A compromise has been reached between banks and the crypto industry, resolving one of the most contentious issues: yield rewards.

The agreement bans rewards that are 'economically or functionally equivalent' to deposit interest, effectively prohibiting passive yield rewards for holding assets. However, activity-based rewards tied to actual usage, such as payments, transfers, or on-chain activity, remain intact.

This decision is seen as a strategic win for the crypto industry, with major players like Coinbase hailing it as a step forward for innovation and US competitiveness. According to Coinbase's Chief Policy Officer Faryar Shirzad, the ability for Americans to earn rewards based on real usage of crypto platforms and networks has been protected.

However, not everyone is convinced that this compromise goes far enough. The Crypto Council for Innovation warned that the restrictions may limit consumer incentives and weaken US leadership in a global market where most crypto activity already occurs offshore.