- Senators Angela Alsobrooks and Thom Tillis are co-leading negotiations on a stablecoin yield compromise, targeting a late-March Senate Banking Committee markup of the Digital Asset Market Clarity Act after a January postponement.
- The proposed framework would permit activity-linked rewards while prohibiting interest on idle stablecoin balances.
- The American Bankers Association formally rejected an earlier White House compromise on March 5, and Coinbase has withdrawn support for the bill over yield restrictions, leaving both sides short of agreement with a narrowing legislative window.
Senator Angela Alsobrooks said lawmakers are working toward a compromise on US stablecoin rules, with negotiations focused on whether issuers can offer yield to users.
Speaking on March 10, Alsobrooks said any agreement would likely leave both sides
dissatisfied. She and Senator Thom Tillis are attempting to move the Digital Asset Market Clarity Act forward after it stalled in the Senate Banking Committee in January.
The dispute centers on stablecoin rewards. Banks oppose interest-like payments on stablecoin balances, arguing they could pull deposits away from the traditional banking system.
The American Bankers Association has warned that up to US$500 billion (AU$735 billion) could shift out of bank deposits by 2028.
Related: Jamie Dimon Warns Stablecoin Yield Fight Could Threaten US Financial System
A Heated Debate
The emerging proposal splits rewards into two categories. Incentives tied to activity, such as payments, staking participation or loyalty programs, would be allowed. Payments that function like interest for simply holding stablecoins would be banned.
Senator Mike Rounds said lawmakers are exploring structures that link rewards to account activity instead of token balances.
But the compromise is facing a lot of resistance. The American Bankers Association rejected a previous White House proposal on March 5. That framework would have allowed limited yield in peer-to-peer payment cases.
Coinbase also withdrew support for the bill after the yield restrictions were introduced.
The White House has continued to push negotiations forward. President Donald Trump urged banks not to block crypto legislation, and officials circulated updated draft language to both industry and banking groups.
Read more: Scaramucci Blames Trump’s “Grift” for CLARITY Act Delays, But Says Bitcoin Could Hit $100K
The debate also connects to the GENIUS Act, which sets a federal framework for stablecoins. The Office of the Comptroller of the Currency released a 376-page implementation proposal on February 25 that treats stablecoin yield as generally prohibited unless issuers can justify it under specific conditions.
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