Key Highlights

  • Senators Thom Tillis and Angela Alsobrooks released compromise text for the CLARITY Act that permits stablecoin rewards tied to transactional use while banning interest-like yield on idle balances.

  • Major crypto trade groups, including Coinbase and Circle, immediately backed the deal and called on the Senate Banking Committee to schedule a markup.

  • The compromise resolves a key sticking point that had held up the CLARITY Act for months, though several other negotiating points remain unresolved.

Senators Thom Tillis and Angela Alsobrooks released new compromise text for the CLARITY Act on May 1, addressing the stablecoin yield dispute that had been one of the primary obstacles to the bill's progress. The text, reported by CoinDesk, would prohibit stablecoin issuers from offering yield equivalent to bank deposit interest on idle balances, while explicitly allowing rewards tied to transactional activity described as "bona fide activities."

Under the framework, firms would need to restructure existing rewards programs from a "buy and hold" model to a "buy and use" model. That distinction is designed to draw a regulatory line between stablecoin rewards that function like bank interest and those that incentivize active spending or use within a payments network.

The crypto industry moved quickly to endorse the deal. According to reporting from May 2, major trade groups representing Coinbase, Circle, and other firms issued statements backing the compromise and called on the Senate Banking Committee to schedule a markup session that would allow the bill to advance.

The yield question had been one of the most contentious issues in CLARITY Act negotiations, with banks arguing that stablecoin rewards that function like interest would place them at a competitive disadvantage. The compromise attempts to address that concern by tying permissible rewards to usage rather than balance size. Whether that distinction will satisfy banking sector opponents and clear the path to a committee vote remains to be seen, as several other provisions in the legislation are still under negotiation between the parties.