Senate Banking Committee Faces Banking Lobby Push on Stablecoin Yield Provision

The CLARITY Act, passed by the House in July 2025, aims to create a unified digital-asset regulatory framework, dividing oversight between the SEC and CFTC and covering DeFi, banking and illicit finance. A May 1 compromise between Senators Thom Tillis and Lisa Alsobrooks bans passive stablecoin yields but permits usage-based rewards.

Senate panel considers CLARITY Act as banking groups propose stablecoin yield changes

Key actors are Senators Thom Tillis (R-NC) and Lisa Alsobrooks (D-MD), the banking coalition led by the American Bankers Association and the Bank Policy Institute, and crypto firms such as Coinbase, whose chief legal officer is Paul Grewal.

Bloomberg

May 1 – Senators finalize the stablecoin-yield compromise.

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May 8 – Banking coalition urges tighter language and broader bans.

Banks Are Trying to Kill the Biggest Crypto Bill in US History Four Days Before the Senate Vote

May 9 – Bloomberg reports a push to eliminate all rewards.

Senate Puts Long-Stalled Crypto Bill on This Week's Age…

May 14 – Senate Banking Committee markup.

Bloomberg

May 21 – Memorial Day recess deadline; missing it could stall the bill.

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July 4 – Target for presidential signature.

Banks Are Trying to Kill the Biggest Crypto Bill in US History Four Days Before the Senate Vote

The provision decides if crypto platforms can use interest-like incentives, shaping competition with banks. Proponents say clear rules spur innovation; banks argue unchecked stablecoin yields could erode deposits and loan capacity.

Banks Are Trying to Kill the Biggest Crypto Bill in US History Four Days Before the Senate Vote

Senators Tillis and Alsobrooks said the compromise “allows crypto companies to offer other forms of customer rewards” and keeps the CLARITY Act bipartisan. They disagreed with the banking lobby’s revisions. Neither Tillis’s office nor Senate Banking Chairman Tim Scott’s office commented.

Bloomberg

Industry advocates say the banking push aims to “kill competition.” Paul Grewal of Coinbase called the language “not a ‘narrow fix’ and instead designed by the banking lobby for ‘killing competition.’” They also label the stance “anti-competitive.”

Bloomberg

Sources differ on reward scope: some describe the compromise as allowing “transaction-based rewards” or “rewards tied to actual usage,” while the banking letter warns that existing “exceptions” could enable evasion. No independent data confirm the claimed 20 % loan-reduction impact.

Senate Puts Long-Stalled Crypto Bill on This Week's Age…

• “Our compromise also allows crypto companies to offer other forms of customer rewards,” — Senators Thom Tillis and Lisa Alsobrooks

Bloomberg

• “includes exceptions that will enable evasion of the intended prohibition and incentive customers to hold and grow stablecoin balances at the expense of deposits.” — American Bankers Association (letter)

Bloomberg

• “Banks have stated explicitly that yield-bearing stablecoins could reduce consumer, small business, and farm loans by 20% or more.” — MEXC article (attributed to banks)

Banks Are Trying to Kill the Biggest Crypto Bill in US History Four Days Before the Senate Vote

The May 14 markup will decide whether the compromise stays intact or is altered by banking coalition. Missing the May 21 recess could push the CLARITY Act off the 2026 Senate calendar, jeopardizing the July 4 enactment target.

Banks Are Trying to Kill the Biggest Crypto Bill in US History Four Days Before the Senate Vote