The stablecoin yield dispute, the main issue delaying the crypto market structure bill, may be close to being resolved after a second round of meetings with Senate staff, recent reports have revealed, creating expectations for a markup session by the end of the month.
Stakeholders optimistic about final compromise
On Monday, Crypto In America said the stablecoin yield dispute, the key issue blocking the highly anticipated crypto market structure bill, also known as the CLARITY Act, “appears to be at an inflection point after a second round of meetings with Senate staff late last week.”
At the end of the week, the crypto and banking industries examined the latest texts on whether companies can offer rewards to stablecoin holders without triggering a deposit flight. Two anonymous sources, one from each party, told Crypto in America that crypto industry participants read the text on Thursday, while banks were informed about it on Friday.
According to the report, neither source discussed details of the latest version of the stablecoin compromise, but “said they were hopeful that a workable solution would have been found this time.”
The latest agreement follows the crypto industry’s dissatisfaction with the project in late March. It is worth noting that both parties are at odds over the potential ban on yield and rewards on stablecoin balances, thus delaying the crypto bill by almost three months.
Last month, the crypto and banking industries considered the revised CLARITY Act, which would have prohibited platforms from offering a return, directly or indirectly, for holding a stablecoin, or in a manner that resembles a bank deposit.
This restriction would apply broadly to digital asset service providers, including exchanges and brokers, as well as their affiliates. The text would aim to limit workarounds and prohibit any activity “economically or functionally equivalent” to interests, thus responding to the concerns of the banking sector.
The proposal reignited backlash from major crypto players including Coinbase and Stripe. Coinbase told Senate offices that it could not support the updated draft because the company had “significant concerns” about the latest stablecoin yield language.
However, Coinbase CLO Paul Grewal generated excitement about the legislation last Wednesday after suggesting that Senate negotiators were “very close” to reaching an agreement on the language.
Publication of the final text of Stablecoin Yield for the end of April?
With Congress on Easter recess, Monday’s report said it remains unclear whether the Senate Banking Committee will release the final draft before the bill’s review session, scheduled for late April.
As reported by Bitcoinist, the text on the stablecoin yield compromise was initially planned to be released before the break, but compared to the forecast at the end of March, it was postponed until the second half of the month.
A spokesperson for Sen. Thom Tillis’ office said final text on the compromise between industry stakeholders and the Senate Banking Committee would be delayed due to concerns that releasing the text before a markup “could give opponents an opening to slow the bill’s progress.”
Now, “if the issue of yield does indeed take a back seat, that means that the staff and members of the Banking Committee, once they return, will have the next two weeks to resolve, as best they can, the remaining issues related to DeFi, tokenization and token classification,” which have also seen quiet progress over the past few months, Senator Tim Scott said recently.
The total crypto market capitalization is at $2.35 trillion in the one-week chart. Source: TOTAL on TradingView
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