Quick overview

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A revised draft of the U.S. stablecoin regulatory bill has secured bipartisan agreement in the Senate, marking a key step forward in efforts to establish a clearer legal framework for crypto assets.

However, both traditional banks and crypto firms remain dissatisfied with different aspects of the proposal.

Senate Advances Updated Clarity Act Framework

In recent days, the U.S. Senate Banking Committee reached a new compromise on amendments to the so-called Clarity Act, legislation designed to define a regulatory structure for cryptocurrencies in the United States, with a particular focus on stablecoins.

While the latest revision reflects broader political alignment, it has not fully resolved industry concerns. Banks argue that further changes are still needed, while crypto companies say the proposal remains overly restrictive and could set a negative precedent for the broader digital asset ecosystem.

Stablecoins and Yield Restrictions at the Core of the Deal

The compromise, led by Senators Thom Tillis (Republican) and Angela Alsobrooks (Democrat), establishes that stablecoins will not be allowed to offer yields comparable to traditional bank deposits.

However, the bill introduces a carve-out for what lawmakers describe as “bona fide activities”—uses that generate returns as a direct result of the asset’s utility, rather than functioning as a substitute for regulated financial products.

The legislation also directs the Treasury Department and the Commodity Futures Trading Commission to define, within one year of enactment, a non-exhaustive list of permitted activities. These are expected to include payments, transfers, staking, governance tokens, and loyalty programs.

If enacted, the framework would push crypto firms to shift their rewards structures away from a “buy-and-hold” model toward a “buy-and-use” system.

The next step is a Senate Banking Committee debate scheduled for the week of May 11. If approved, the bill would move to the full Senate floor, with discussion expected in June or July.

Banks Say the Draft Falls Short

Following the release of the full text, several major banking groups—including the American Bankers Association, the Bank Policy Institute, the Consumer Bankers Association, the Financial Services Forum, and Independent Community Bankers of America—issued a joint statement welcoming the intent behind the legislation but criticizing its execution.

While they acknowledged that Senators Tillis and Alsobrooks aim to prohibit stablecoin yields and interest payments, they argued that the current drafting “fails to achieve that objective.”

“It is imperative that Congress gets this right,” the groups said. “Multiple studies show that yield-bearing stablecoins could reduce consumer, small business, and agricultural lending by 20% or more, making a clear and transparent prohibition essential.”

The coalition added that it will submit detailed recommendations in the coming days to strengthen the wording of the bill, emphasizing continued cooperation with lawmakers.

“We will continue working in good faith to help Congress embrace innovation while protecting the deposits that support local lending and economic activity in their communities,” the statement concluded.