Highlights:
- The mark-up of the Clarity Act talks proceed, with lawmakers agreeing on the bill’s key provisions.
- Stablecoin yield fight postpones progress, but talks indicate a close end.
- Markets respond with declines in stocks and funds amid uncertainty over the Clarity Act.
Clarity Act negotiations in Washington appeared to move into a more active phase this week after Coinbase Chief Legal Officer Paul Grewal said the bill is heading toward a markup hearing in the U.S. Senate Banking Committee, with a possible floor vote to follow if lawmakers resolve the dispute over stablecoin yield. His remarks, made during a Wednesday interview on Fox Business, pointed to progress on one of the main unresolved issues in the Senate’s crypto market-structure talks.
Stablecoin yield remains the main obstacle.
The legislation, formally titled the Digital Asset Market Clarity Act, has remained tied up by disagreements over whether stablecoin issuers or crypto platforms should be allowed to provide yield or similar rewards.
That debate has delayed committee action and left the broader effort to establish federal digital asset oversight rules unfinished. Grewal said lawmakers were close to agreement on the bill’s core provisions and expected progress on the stablecoin yield issue within 48 hours. In a follow-up post on X, he also said Congress was ready to act.
Source: Chief Legal Officer, Coinbase, Paul Grewal
According to Grewal, lawmakers are close to a deal on the broader structure of the bill, but the yield language still needs to be settled before the Senate Banking Committee can move ahead with markup. He said the banking industry has argued that stablecoins could create deposit flight, especially from community banks, if yield is allowed. Grewal stated that there has been no evidence of such a shift.
The disagreement has already affected the legislative calendar. A planned Senate Banking Committee session on the bill was canceled in mid-January as lawmakers failed to settle the matter. Since then, negotiations have continued, including work late in March by Senators Thom Tillis of North Carolina and Angela Alsobrooks of Maryland on a compromise draft text. That effort reportedly resulted in an agreement in principle with the White House.
Clarity Act timeline points to April vote pressure
The current legislative schedule places added pressure on negotiators. Grewal said he expects the Clarity Act to move toward a Senate Banking Committee markup hearing in the next few weeks, with the possibility of a floor vote after that. He said he was very confident that progress would be made on the stablecoin yield agreement in the near term.
The bill’s timeline has also drawn attention because of a warning from Senator Bernie Moreno of Ohio. That warning places April at the center of the next phase of negotiations, with a key vote expected during the month.
Prediction markets also reflected stronger expectations for passage. Polymarket traders were shown assigning the bill a 65% chance of being signed into law by President Donald Trump this year, up from 48% the previous day. The shift suggested that expectations rose as negotiations over the yield provisions appeared to be moving toward resolution.
Market reaction has tracked the legislative uncertainty
The extended debate around the Clarity Act has also been linked to recent market moves cited in the source material. Circle’s stock fell 20% after investors learned that restrictions on stablecoin yields were under consideration. At the same time, Ethereum funds recorded $222 million in outflows amid uncertainty over crypto legislation.
The source material also stated that the legislative outcome carries financial consequences for Coinbase. It said the company’s stock has declined 50% over the past six months amid regulatory uncertainty.
At the same time, the legislation would offer regulatory clarity that could affect how U.S. crypto exchanges compete with offshore platforms that already offer stablecoin yield products. The provided information described those products as a key revenue driver that Coinbase has not been able to fully deploy in the domestic market to date fully.
Political and industry positions have shaped the debate
The Clarity Act debate has expanded beyond Congress and into public statements from major industry and political figures. Last month, President Donald Trump accused banks of working against crypto legislation, saying they should not undermine the GENIUS Act or hold the Clarity Act hostage over stablecoin yield payments.
The statement was later followed by reports that Trump had met privately with Coinbase Chief Executive Officer Brian Armstrong just hours before posting the remarks.
Armstrong had already raised objections earlier in the year. In January, he said Coinbase could not support the market structure bill as written, pointing to draft amendments that would remove stablecoin rewards and allow banks to restrict competition. Those comments placed Coinbase among the companies pushing back against the proposed limits.
