US Stablecoin Legislation Progress Lifts Crypto-Linked Stocks

Crypto-linked equities outperformed a weaker broader market on Monday as investors reacted to fresh momentum around U.S. stablecoin legislation. Circle led the move with a nearly 20% gain, while bitcoin also traded higher even as major U.S. stock indexes fell amid Middle East geopolitical uncertainty.

The Clarity Act compromise prohibits U.S. stablecoin issuers from paying interest-like yields, but allows platforms like Coinbase to offer rewards distinct from bank interest. This move is seen as a boost for the sector, with renewed stablecoin clarity attracting sector-specific flows.

Major banking trade groups oppose provisions in a 2025 stablecoin law that bar issuers from paying interest directly but still leave room for platforms such as Coinbase to offer rewards. Those groups argue that such incentives could pull deposits away from traditional banks.