After months of negotiations, the United States Senate Banking Committee announced on May 5 a bipartisan compromise on stablecoin yields to fast-track the passage of the Clarity Act, a proposed federal regulation aimed at legalizing crypto assets
Senators Thom Tillis, a Republican from North Carolina, and Angela Alsobrooks, a Democrat from Maryland, announced a deal had been struck on section 404 of the Clarity Act to prevent deposit flight from banks to crypto platforms. Precisely, the committee highlighted that the new resolution prohibits crypto platforms from offering stablecoin yields to customers simply for passively holding.
“Our compromise also allows crypto companies to offer other forms of customer rewards. Most importantly, it helps put us on a bipartisan path to pass the Clarity Act, providing the regulatory certainty needed to foster innovation. Some in the banking industry may not want either of these things to happen, and we respectfully agree to disagree,”the statement noted.
Notably, U.S. banks pay customers around 0.57% interest on their deposits. However, crypto platforms offered more than 4% on stablecoin deposits, heating up the debate over potential capital flight.
Stablecoins yield compromise boosts odds for Clarity Act passage
Following the stablecoin yield compromise, the odds of the Clarity Act passing and getting signed into law by the end of this year surged. As of press time, the odds of this bill reaching President Donald Trump’s desk surged to 69%, according to data from Polymarket. At the time of reporting, this contract had a reported volume of about $619,464.
Last month, Polymarket traders had slashed the chances of the Clarity Act passing this year to as low as 43% after Senator Tillis announced more delays, as Finbold reported. However, traders are more optimistic of a markup in May to pave the way for a floor debate in the subsequent weeks before the members go for the August recess.
Furthermore, President Trump said last month during a private meeting with top holders of Official Trump (TRUMP) memecoin that he would sign the Clarity Act immediately after it reaches his desk to give the country an edge in the cryptocurrency industry.
