TLDR
A major US crypto market-structure bill has hit a new stalemate after large banks rejected a White House compromise on stablecoin yields.
- The CLARITY Act has stalled in the Senate after banks opposed allowing many yield-bearing stablecoin rewards, despite crypto firms accepting the latest compromise.
- Banks argue the bill could trigger massive deposit flight into high-yield stablecoins, while crypto advocates say banks are protecting profit margins, not stability.
- The bill is not dead, but progress now hinges on revised yield rules, upcoming Senate hearings, and how hard the administration pushes before the election cycle.
Deep Dive
1. What Stalled And Why
Talks on landmark US crypto legislation, centered on the Digital Asset Market Structure CLARITY Act, have reached a fresh impasse after major banks rejected a compromise brokered by the White House on stablecoin rewards analysis piece.
The compromise would have allowed some rewards on stablecoin use, such as for peer to peer payments, but not interest on idle balances. Crypto firms, including large exchanges, have broadly accepted that framework, but banking groups are pushing back, arguing it is still too permissive for yields on stablecoin holdings Reuters summary.
As a result, the Senate Banking Committees work on the broader market-structure bill and related stablecoin rules has been postponed, with earlier markups already delayed amid disputes over yield-bearing stablecoins Cointelegraph report.
2. Why Banks Are Revolting
Banks warn that generous stablecoin yields could drain deposits from traditional savings accounts into crypto platforms. Standard Chartered has estimated that stablecoins could pull around 500 billion dollars in deposits out of US banks by 2028 under favorable rules Reuters summary.
On the other side, Eric Trump and other pro?crypto figures say large banks paying 0.01 to 0.05 percent on savings are lobbying to block stablecoin yields of 4 to 5 percent that threaten their spread-based profits community recap. They argue financial stability messaging is being used to limit competition rather than protect consumers.
The real fight is over who captures the yield on dollar balances: banks through low-rate deposits, or crypto platforms through higher-yield stablecoin products.
3. What To Watch Next
The CLARITY Act, which also coordinates crypto oversight between the SEC and CFTC, passed the House in 2025 but remains stuck in the Senate Banking Committee overview. A related stablecoin bill, the GENIUS Act, already provides a federal framework but restricts issuers from paying interest on simple stablecoin holdings Cointelegraph report.
President Donald Trump has publicly criticized banks for undermining his crypto agenda and is urging Congress to move quickly on market-structure legislation before the industry migrates overseas community recap. Upcoming Senate hearings and any redraft of the yield provisions will determine whether a deal is possible this year or whether clarity slips again.
For crypto users and builders, the key signals are changes to yield rules in draft text and whether Senate leadership schedules real votes; until that happens, US regulatory uncertainty stays elevated.
Conclusion
The headline fight is not about whether crypto exists in the US, but about how far stablecoins and exchanges can go in offering yield without hollowing out bank deposits.
If banks hold the line and the Senate does not move, the CLARITY Acts broader benefits for regulatory certainty and institutional adoption may remain stuck, leaving the US to lag jurisdictions that already have clear crypto frameworks.
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