Coinbase announced Friday that a deal has been struck on a key provision in landmark U.S. crypto legislation, potentially clearing the path for the bill to move forward in the Senate.
What stalled the bill
The legislation had stalled earlier this year after banks pushed back against a provision that would allow stablecoin issuers and crypto firms to offer yield-bearing products and rewards on stablecoins.
Banks argued such products could lure away deposits and make it harder for them to fund lending.
Crypto companies, including Coinbase, countered that barring rewards would be anticompetitive and would prevent them from recruiting customers.
The compromise
Senators Thom Tillis and Angela Alsobrooks finalized the compromise language, according to Punchbowl News, which reported the text.
The deal includes a broad prohibition on rewards offered “in a manner that is economically or functionally equivalent to the payment of interest or yield on an interest-bearing bank deposit.”
It also directs regulators to propose a new stablecoin disclosure regime and a list of permissible reward activities.
Coinbase’s Chief Policy Officer Faryar Shirzad said in a post on X:
“In the end, the banks were able to get more restrictions on rewards, but we protected what matters – the ability for Americans to earn rewards, based on real usage of crypto platforms and networks.”
Broader context
Crypto companies have long operated in a regulatory gray area that executives say has held back their businesses.
The proposed Clarity Act aims to establish clear rules to promote cryptocurrency adoption.
President Trump, who made crypto reform a priority during his second administration, courted crypto industry support on the campaign trail and his family has profited from its own token.
