Washington D.C. – US lawmakers are approaching a consensus on the structure of a comprehensive bill regulating the digital asset market, according to Paul Grewal, Coinbase’s Chief Legal Officer.

Progress on the CLARITY Act

Grewal stated that the US Digital Asset Market Clarity Act is “moving toward” a markup hearing in the Senate Banking Committee. A floor vote could follow if senators resolve ongoing disagreements concerning stablecoin yield.

Stablecoin Yield as a Key Sticking Point

The debate over whether stablecoin issuers and platforms should be permitted to offer yield or rewards remains a significant obstacle to finalizing the legislation. This dispute has contributed to delays in scheduling a markup by the Senate Banking Committee.

Concerns from Traditional Banking Sector

US banks have advocated for restrictions on stablecoin yield, expressing concerns that such incentives could divert deposits from traditional financial institutions and potentially destabilize the banking system. Grewal countered these claims, stating there is no evidence to support fears of significant deposit flight.

Potential Impact of the Legislation

Some observers believe the passage of the CLARITY Act will positively influence crypto investor sentiment. However, concerns have been raised that the bill, in its current form, could leave the crypto industry vulnerable to future regulatory changes depending on the administration in power.

Grewal emphasized the importance of developer protections within the CLARITY Act, arguing that prioritizing short-term business interests over these protections could lead to a regulatory environment susceptible to political shifts. He stated, “The point of passing CLARITY is not to trust this administration. It is to bind the next one.”

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