White House and Congressional Members Reach Preliminary Agreement in Principle on Stablecoin Revenue Provisions of the CLARITY Act

Deep Tide TechFlow News, March 21, According to Cointelegraph, and Politico reported on Friday that members of the Senate Banking, Housing, and Urban Affairs Committee, Republican Senator Thom Tillis and Democratic Senator Angela Alsobrooks, reached a “principled agreement” on stablecoin yields, potentially advancing the progress of the “Digital Asset Market Clarity Act” (CLARITY Act). Alsobrooks stated that the agreement aims to protect innovation while preventing large-scale deposit outflows and will prohibit offering stablecoin yields on “passive balances.” Tillis said that the agreement still needs to undergo review by the crypto industry before finalization.

The CLARITY Act was originally expected to proceed smoothly after the signing and enactment of the GENIUS Act, but in January this year, it stalled due to objections from major industry players like Coinbase regarding whether stablecoin issuers can distribute yields to token holders. The banking sector opposes yield-bearing stablecoins, fearing they could trigger deposit withdrawals and erode bank market share. In response, Patrick Witt, Executive Director of the White House Digital Asset Advisory Committee, said these concerns are exaggerated, believing that legalization and regulation of dollar-pegged yield-bearing stablecoins could actually bring significant new capital into the U.S. banking industry.

Cynthia Lummis, a senator from Wyoming, stated at the DC Blockchain Summit this Wednesday that the full crypto regulatory framework is “very close” to being passed, and her spokesperson revealed that the agreement is expected to be implemented “within the next few days.”