Senate Close to Stablecoin Rewards Deal; Other Issues Pending

Senators leading talks on the Clarity crypto bill say they are close to agreement on language that would limit certain stablecoin rewards while leaving other disputes unresolved.

Sen. Angela Alsobrooks and Sen. Thom Tillis have spent months negotiating wording aimed at preventing passive, interest‑like yields on stablecoin holdings without banning rewards that are native to crypto platforms or tied to user activity.

The Clarity bill would assign regulatory roles for digital assets, define when tokens qualify as securities or commodities, and set new disclosure requirements. The White House convened multiple meetings to narrow differences between banks and crypto firms. Banking groups say yield‑bearing stablecoins could draw deposits from community banks. Crypto firms argue strict limits could curb platform incentives.

A spokesperson for Sen. Alsobrooks said negotiators are in a “good spot on yield” but still need to resolve illicit finance and ethics language. Tillis has indicated the Senate Banking Committee will not hold a markup in April. Other senators have urged a faster timetable and warned that failure to act by May could delay progress.

The draft compromise would bar yields that are paid passively or that mimic interest on bank deposits while preserving bona fide rewards and incentives tied to active transactions or platform functions. People familiar with the talks describe the wording as narrowly targeted and say major changes could undo months of negotiation.

Banking trade groups have publicly urged senators to close what they call a stablecoin loophole. Executives from crypto firms have pressed lawmakers to adopt clear rules that do not unduly limit rewards on platforms.

Negotiators are also focusing on a provision from the House bill that would clarify whether non‑custodial developers are money transmitters. Some senators worry a broad exemption for developers could weaken prosecutors’ tools to pursue financial crimes.

Ethics questions have emerged because of the president’s and his family’s financial ties to crypto projects, including recently launched memecoins and a family stake in a mining firm. Several senators wrote to a promoter of an upcoming memecoin fundraiser seeking details and urging Congress to review whether existing rules prevent conflicts of interest when the president profits from crypto businesses.

Senators involved in the talks say they are balancing consumer protection, banking stability, law enforcement needs and support for digital finance. They expect to continue negotiating language on yield, illicit finance and ethics before scheduling a committee markup.