CNBC reported today that Senators Angela Alsobrooks (Democrat), Thom Tillis (Republican), and the White House have reached an "agreement in principle" on the most contentious clause in the CLARITY Act—the issue of stablecoin yields.
Specific details have not yet been made public, but sources revealed that the direction has been set: crypto platforms can continue to give users "rewards," but they cannot describe them in any language that sounds like a banking product.
The origin of the controversy: the loophole left by the stablecoin bill
In July 2025, US President Trump signed the GENIUS Act (Stablecoin Regulation Act).
This law contains a core prohibition: stablecoin issuers are prohibited from paying any form of interest or income to holders.
But the law left a loophole.
The GENIUS Act governs "issuers," not "platforms."
Take Coinbase as an example: USDC is issued by Circle, while Coinbase is just a distribution platform.
Circle shares a portion of its reserve earnings with Coinbase, which then distributes them to users under the guise of a "rewards program"—the entire process circumvents legal restrictions.
Circle distributes a portion of its USDC reserve revenue to exchanges, which then distribute it to retail users as rewards—this "three-party model" is not explicitly prohibited under the GENIUS Act.
The crypto industry calls this a "legitimate structure," while the banking industry calls it a "regulatory arbitrage loophole."
The two sides argued about this for more than three months.
)
The antagonism between the two sides: a struggle for core interests
Why is the banking industry so strongly opposed?
A study by the Treasury Department's advisory committee identified $6.6 trillion in U.S. transactional deposits as "risk exposure"—money that could flow out once stablecoins offer large-scale yields.
Deposits are the most crucial source of funds for banks. Deposit outflows mean a decline in lending capacity, ultimately leading to credit contraction.
JPMorgan Chase CEO Jamie Dimon stated directly on CNBC: Paying yield on stablecoin balances is running a bank and therefore subject to banking regulations.
Therefore, five major industry organizations, including the American Bankers Association and the Consumer Bankers Association, lobbied the Treasury Department to close the loophole and extend the ban to situations where "the issuer makes indirect payments through any affiliate or partner".
The bank's logic is: the name doesn't matter, the economic substance does. Whether it's called "reward" or "dividend," it's essentially interest.
The crypto industry's counterattack
The crypto industry, of course, strongly opposed it, and even got President Trump, who supports the crypto industry, to endorse it.
On March 4, 2026, Trump posted on Truth Social: "The GENIUS Act is being threatened and undermined by banks, which is unacceptable. Banks must reach a good deal with the crypto industry because that is in the best interest of the American people."
On the same day, Coinbase CEO Brian Armstrong appeared at the White House. Following the news, Coinbase's stock price surged by as much as 15% intraday.
Final compromise: a solution where both sides concede one step
The core logic of the compromise reached today is roughly as follows:
Certain rewards are permitted, but only in scenarios where users actively use stablecoins (such as trading, payments, or participating in infrastructure), rather than in scenarios where they are passively held.
Senator Lummis stated that anything that sounds like banking product terminology will not appear in the final bill.
It can be assumed that:
- The banking industry has won on the surface: the power of discourse and regulatory principles—stablecoins cannot be classified as competitors to bank deposits;
- The crypto industry has secured its core success: the core of its business model—the revenue mechanism—still exists, just in a different guise.
Open a stablecoin interest-earning account
Binance , BingX , Bitget , MSX , Backpack , Sun Wukong , mgbx , hotcoin , ourbit , easecoinx , XT , Pionex Websea , bitmart , coincatch , htx , coinw , weex , mexc , gateokx , hibit bitunix
