Key Takeaways:
A landmark compromise on stablecoin rewards has removed a critical obstacle for the Digital Asset Market Clarity Act, fueling a market rally that pushed Bitcoin back above $78,000 by Saturday morning. The deal, announced by key senators, clarifies how crypto platforms can offer yield, a breakthrough that raises the odds of comprehensive crypto legislation passing in the US this year.
"Mark it up," Coinbase CEO Brian Armstrong said in a post on X, reflecting the crypto industry's support for the bill to move forward. The company’s Chief Legal Officer, Paul Grewal, emphasized that the framework “preserves activity-based rewards tied to real participation on crypto platforms and networks.”
The agreement between Senators Thom Tillis and Angela Alsobrooks explicitly forbids crypto firms from offering returns that are “economically or functionally equivalent” to bank deposit interest. However, it carves out the ability for companies to provide rewards based on “bona fide activities,” a crucial distinction for the crypto industry. Following the news, odds on the prediction market Polymarket for the CLARITY Act to become law in 2026 surged nine points to 55 percent.
This legislative progress provides the clearest path yet for a comprehensive regulatory framework for digital assets in the United States. The resolution of the stablecoin yield issue, a major point of contention between the banking and crypto sectors, could accelerate the bill’s journey through the Senate. The next step is a potential markup proceeding in the Senate Banking Committee, which could happen as soon as the week of May 11.
The compromise addresses concerns from traditional financial institutions that yield-bearing stablecoins could act as unlicensed deposit accounts, draining capital from the banking system. The new language directs the Treasury Department and the Commodity Futures Trading Commission to establish rules within one year of enactment to define what constitutes a qualifying activity for rewards, separating active platform participation from passive holding.
Crypto exchange Coinbase, which was deeply involved in the negotiations, acknowledged the compromise. Faryar Shirzad, the company's Chief Policy Officer, noted that while banking interests secured significant limitations, the core ability for crypto platforms to reward users for genuine engagement remains intact.
The breakthrough has revived momentum for the bill, which had stalled earlier in the year. Senator Cynthia Lummis had declared on April 11, “It’s now or never” for crypto legislation, while Senator Bernie Moreno recently projected the bill could be finalized by the end of May. The positive development coincided with a broader market upswing, with Bitcoin recovering from a dip to $75,500 earlier in the week.
This article is for informational purposes only and does not constitute investment advice.
