Lawmakers are racing to pass a crypto market structure bill this year, with a key compromise on stablecoin yield emerging as a potential unlock. The Digital Asset Market Clarity Act has stalled over disputes between the banking industry and crypto proponents regarding stablecoin rewards and their potential impact on traditional deposits.
Senator Angela Alsobrooks, a Democrat, stated that a negotiated compromise aims to protect against "deposit flight" while still fostering innovation. She indicated that both bankers and the crypto industry might find aspects of the agreement "just a little bit unhappy."
The proposed compromise appears to focus on allowing a narrower scope of stablecoin activity to be eligible for customer rewards. This comes after last year's GENIUS Act, which barred payment stablecoin issuers from paying interest to attract customers, a move bankers argue should apply equally to crypto exchanges.
Senator Mike Rounds suggested that stablecoin rewards might be tied to account activity rather than balance size. Meanwhile, JPMorgan Chase CEO Jamie Dimon has indicated potential acceptance of transaction-based rewards. The Office of the Comptroller of the Currency's recent proposal on stablecoin rewards is seen as potentially allowing for customer incentive programs, though its stance on yield evasion remains a point of discussion.
Despite ongoing debates on issues like decentralized finance and potential conflicts of interest for government officials, the bill could advance to a markup hearing if the compromise language satisfies key senators. Further hurdles include securing sufficient votes in the full Senate and navigating other pressing legislative matters.