A preliminary accord has reportedly been reached by the White House and bipartisan members of the Senate Committee on Banking, Housing, and Urban Affairs to advance the Digital Asset Market Clarity Act, commonly known as the CLARITY Act. The agreement centers on establishing clear guidelines for stablecoin yield, explicitly banning interest payments on passive stablecoin holdings to address concerns over deposit flight from traditional banks.
Key provisions under discussion include a prohibition on yield offers for unencumbered stablecoin balances, safeguarding the stability of deposit bases at regulated depository institutions. The deal also proposes stringent custody requirements for stablecoin issuers, mandating segregation of reserve assets and independent audits to ensure full backing. Industry participants are awaiting final language on exemptions for ancillary businesses such as payment processors and DeFi protocols that might rely on interest-bearing mechanisms.
Republican Senator Thom Tillis and Democratic Senator Angela Alsobrooks have emerged as principal negotiators, with both emphasizing the need to balance innovation protection with systemic risk management. A spokesperson for Senator Alsobrooks indicated that ethics language is still under development, while Senator Tillis noted that the crypto industry must vet the draft before a formal vote. At the DC Blockchain Summit, Wyoming Senator Cynthia Lummis urged rapid completion, asserting that the framework will “protect innovation” without compromising financial stability.
If finalized, the CLARITY Act would represent the first comprehensive federal legislation delineating the regulatory perimeter for crypto market infrastructure since the GENIUS Act. Observers expect the bill to include coordination mandates between the SEC and CFTC on enforcement and oversight. With Congress aiming to reconcile differing approaches to digital asset regulation, the agreement in principle marks a significant step toward delivering a unified crypto legislative framework in the coming weeks.
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