Tillis Pushes for May Pause on CLARITY Act Markup CATEGORY: Industry News

US Senator Thom Tillis has nudged Senate Banking Committee Chair Tim Scott to push back the markup of the CLARITY Act crypto market structure bill until May, saying the crypto and banking factions still haven't settled their differences over stablecoin yield provisions. The North Carolina Republican told reporters Monday he doesn't see the committee marking up the legislation in April and has suggested slapping it on the calendar for next month instead.

At the heart of the tussle is whether stablecoin holders should actually earn something on their holdings. Bankers have raised red flags that allowing stablecoin rewards could send deposit flows running out the door, particularly hitting community banks that might not have the balance sheet wiggle room to keep up without tapping expensive wholesale funding. Meanwhile, Coinbase CEO Brian Armstrong and other crypto industry heavy hitters have been lobbying for friendlier stablecoin terms. Sources say the two sides were nearly on the same page last month about enabling stablecoin rewards tied to crypto activity on third-party platforms—but not for just sitting on balances doing nothing, like some kind of crypto savings account with a 0% APY.

The delay has got people sweating about the bill's timeline. Treasury Secretary Scott Bessent has cranked up the pressure on Congress to get the CLARITY Act across the finish line, warning that the US midterms in November could send the whole thing spiraling. "I think if the Democrats were to take the House, which is far from my best case, then the prospects of getting a deal done will just fall apart," Bessent said in March. Apparently Bessent is close to hammering out a "grand bargain" with Congress on crypto legislation, though stablecoin yield provisions are still the knot that won't come undone.

Tillis, who's been playing referee between crypto and banking members, told Scott: "It's very important to me not to accelerate things, to hear everybody, and give them a rational basis for what we do accept." The senator's take has found fans among other crypto industry voices who argue getting the bill moving matters more than holding out for terms that would make a yield farmer weep with joy.

This comes the same day crypto advocacy group The Digital Chamber fired off a letter to the Senate Banking Committee asking it to move the legislation forward "as soon as the calendar allows." The group pointed out it's been more than 270 days since the House passed the CLARITY Act with bipartisan support—roughly nine months of waiting, which in crypto time is basically an geological epoch. "Clarity cannot wait," said The Digital Chamber's government affairs director, Taylor Barr, adding: "More than 70 million Americans who have embraced digital assets deserve the regulatory clarity they have waited far too long for."