TLDR
- The CLARITY Act compromise text was released, banning stablecoin issuers from paying yield solely for holding stablecoins
- Crypto firms can still offer rewards tied to real platform activity, not passive holding
- Senators Thom Tillis and Angela Alsobrooks finalized the compromise after months of talks
- Coinbase called the deal a win, with CEO Brian Armstrong saying “Mark it up”
- Polymarket traders now give the bill a 55% chance of passing in 2026, up 9% in 24 hours
A long-running dispute between the banking industry and crypto firms over stablecoin yield has been resolved, clearing a major roadblock for the Digital Asset Market Clarity Act.
The final rewards text in the CLARITY Act is now public.
We’ve been clear throughout this process: much of this debate was based on imagined risks, not real evidence, nor was it based on a real understanding of how crypto actually works.
Nevertheless, the crypto industry showed… https://t.co/XoQ7Zp1Y39
— Faryar Shirzad 🛡️ (@faryarshirzad) May 1, 2026
New legislative text was released Friday by Senators Thom Tillis and Angela Alsobrooks. The text bans crypto companies from paying interest or yield to customers simply for holding stablecoins.
The concern from banks was that stablecoin yield products would act like bank deposits, pulling money away from traditional lenders and making it harder for them to fund loans.
Under the compromise, crypto firms cannot offer returns that are “economically or functionally equivalent” to interest on a bank deposit.
However, the deal does allow rewards tied to what the text calls “bona fide activities.” This means users can earn rewards by actively using crypto platforms and networks, not just by sitting on holdings.
Coinbase was closely involved in the negotiations and had the most at stake. Chief Policy Officer Faryar Shirzad said the banks got more restrictions than crypto firms wanted, but that the core ability to offer activity-based rewards was protected.
Coinbase CEO Brian Armstrong posted a simple response on X: “Mark it up.” Chief Legal Officer Paul Grewal added that the language “preserves activity-based rewards tied to real participation on crypto platforms and networks.”
What Changes for Crypto Firms
One crypto industry source said companies will need to shift from a “buy and hold” model to a “buy and use” model to qualify for the rewards allowance under the new rules.
The text directs the Treasury Department and the Commodity Futures Trading Commission to begin a rulemaking process within one year of the bill becoming law. That process will define more clearly what activities qualify for rewards.
Regulators will be allowed to consider factors like balance, duration, and the nature of the activity when setting those rules. Anti-evasion language is also included in the text.
Timeline and Senate Next Steps
Galaxy Digital head of research Alex Thorn said the release of the text suggests the Senate Banking Committee could schedule a markup “as soon as the week of May 11.”
Thorn also warned that the banking industry is expected to increase its opposition efforts following the release of the final text.
Senator Bernie Moreno recently said he expects the bill to be completed by the end of May. Senator Cynthia Lummis said on April 11, “It’s now or never.”
The Clarity Act had stalled earlier this year after a markup was postponed last-minute in January.
Polymarket traders currently give the CLARITY Act a 55% chance of being signed into law in 2026.
President Donald Trump has made crypto reform a priority in his second term. Crypto companies have long operated in a regulatory gray area, which executives say has limited their business growth.
