Senate Crypto Bill Advances as Senators Reach Stablecoin Yield Compromise

Republican Senator Thom Tillis and Democratic Senator Angela Alsobrooks have reached a compromise on one of the most contested provisions in the Digital Asset Market Clarity Act — a wide-ranging cryptocurrency market structure bill that the industry has been lobbying for. The two senators agreed in principle on how to handle stablecoin yield, clearing a significant hurdle in the bill's path through Congress.

Alsobrooks confirmed the agreement to Politico on Friday, stating that the deal would protect financial innovation while also preventing widespread deposit flight from traditional banks. The compromise reportedly prohibits rewards on passive stablecoin balances, a key concession to the banking industry, which had raised concerns that stablecoin yield products could function similarly to interest-bearing deposit accounts and potentially undermine lending.

Details of the updated legislative text were not expected to be shared with crypto and banking industry stakeholders until Monday, according to a source familiar with the negotiations. The White House was also reviewing revised bill language earlier in the week, though officials had not publicly commented on Friday's development.

While the stablecoin yield issue was a central sticking point, several other unresolved matters remain, particularly around the bill's approach to decentralized finance (DeFi), which has drawn concern from some Democratic lawmakers over potential illicit finance risks.

Despite these remaining challenges, momentum appears to be building. Senate Banking Committee members have signaled that a hearing on the Clarity Act could take place in late April. If the bill clears that committee, it would still need to be reconciled with a version previously passed by the Senate Agriculture Committee before reaching the Senate floor. Senator Cynthia Lummis, who chairs the banking panel's crypto subcommittee, expects a hearing in the latter half of April.

Crypto advocates are hoping for a final resolution as early as May, though limited Senate floor time and competing legislative priorities could affect that timeline.