The CLARITY Act, a landmark piece of crypto market structure legislation, survived a near-death experience in the Senate Banking Committee on May 14. By a vote of 15-9, the bill advanced only after a last-minute bipartisan compromise introduced seven amendments to secure support from wavering members.
Two Democrats joined Republicans to push the bill forward. The most significant amendment addresses stablecoin yields: passive returns for simply holding stablecoins are banned, while transaction-based and activity-based rewards remain permissible.
Senator Mark Warner declined to support the bill, a major red flag. Without his backing, the coalition is far from the 60-vote threshold needed to overcome a filibuster on the Senate floor. Banking lobbyists reportedly worked to slow the bill’s progress, signaling that traditional finance sees the legislation as a competitive threat.
The CLARITY Act would establish the first comprehensive federal framework for digital asset classification and regulation, resolving the SEC vs. CFTC jurisdictional conflict. Projects offering interest-bearing stablecoins would need to pivot to activity-based models or shut down.