CLARITY Act Gains Momentum as Stablecoin Yield Dispute Resolved

The resolution of the dispute over stablecoin yield marks a significant development in the CLARITY Act's journey through Congress.

After months of negotiations, Senators Tillis and Alsobrooks reached an agreement in principle on the issue, paving the way for further progress on the bill. The key terms of the deal include prohibitions on rewards for passive stablecoin balances, while allowing activity-based rewards tied to payments, transfers, and platform use.

Despite this breakthrough, four major issues remain unresolved: DeFi provisions, ethics language, illicit finance concerns, and the attachment of community bank deregulatory provisions. These outstanding issues will need to be addressed before the bill can secure a broad bipartisan vote in the Banking Committee.