Senate Banking Committee Set to Revisit CLARITY Act with Yield Provision at Stake

The upcoming markup of the CLARITY Act is expected to bring significant changes to the crypto market, particularly regarding stablecoins. The bill's yield provision has been a point of contention between traditional banks and crypto companies like Coinbase.

The current version of the bill prohibits passive yield payments on stablecoin holdings, which would remove a significant incentive for holding major stablecoins like USDC and USDT. This change could lead to a decline in on-chain liquidity, potentially increasing transaction costs and trading spreads.