Crypto Bill Clash: Coinbase Rejects CLARITY Act Changes On Stablecoin Yields

Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing How Our News is Made Strict editorial policy that focuses on accuracy, relevance, and impartiality Ad discliamer Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. Cryptocurrency exchange Coinbase has reportedly told Senate offices it cannot support the latest language inserted into the CLARITY Act, dealing a fresh setback to negotiations over the anticipated crypto market-structure bill. 

The dispute centers on newly revised provisions governing stablecoin yield arrangements, a key point of contention that has been the subject of months of talks on Capitol Hill. Coinbase Says No To Late‑Stage Compromise 

The Senate’s updated textwould constrain how stablecoin yield programs operate, limiting structures that try to mirror bank deposit products and tightening the permissible scope of other activities. 

The draft leaves open questions over the mechanisms for classifying activity-based stablecoins and how transaction-reward programs would be treated.  Related Reading Bitcoin, XRP Rallies Won’t Hold Until Oil Falls Toward $80, Expert Warns 21 hours ago

Those uncertainties, combined with what some in the industry view as more restrictive wording, prompted Coinbase to informlawmakers this week that it could not back the late-stage compromise language.

The move marks a softer but still consequential reversal from Coinbase CEO Brian Armstrong’s more forceful opposition in January, which previously stalled the bill’s markup.  Industry Split Over CLARITY Act Draft

Beyond Coinbase, industry responses to the new draft have been mixed. One major trade association toldCrypto In America that the revised language represented a marked departure from what had been discussed with the White House, and described the text as more restrictive for the crypto sector.  Related Reading BlackRock Crypto Outlook: CEO Predicts $500M A Year In Revenue Within Next Five Years 19 hours ago

In contrast, another trade group leader characterized the provisions as largely in line with expectations, arguing they struck an acceptable balance by preserving rewards while preventing interest-like stablecoin offerings.  

“This is the best possible result,” that source said, noting the new draft seemed broader than an earlier proposal advanced by Senators Thom Tillis and Angela Alsobrooks, and expressing confidence that “people will still get their rewards.” The daily chart shows COIN’s drop to $181 on Wednesday’s trading session. Source: COIN on TradingView.com

Coinbase’s stock, trading under the ticker name COIN, concluded Wednesday’s trading session at $181, down nearly 5% from its opening price above $190 per share. 

Featured image from OpenArt, chart from TradingView.com