Stablecoin Yield Provisions — CLARITY Act Draft

Sen. Thom Tillis (R-NC) is set to release draft language this week resolving the most contentious issue in the CLARITY Act: whether crypto firms can pay yield on stablecoin balances. The bipartisan compromise with Sen. Alsobrooks (D-MD) bans passive yield on idle stablecoin holdings but preserves activity-based rewards like transaction rebates and loyalty programs. Banks fear stablecoin yields could drain $6.6 trillion in deposits; the crypto industry argues a blanket ban would stifle innovation. The GENIUS Act (P.L. 119-27, passed 2025) already bans issuers from paying interest but left a loophole for third-party platforms like exchanges. This draft closes that gap while carving out room for active-use rewards. Coinbase has reviewed the text and expressed concerns. Tillis has proposed a "crypto-palooza" summit bringing banks and crypto reps to Capitol Hill to finalize terms. The CLARITY Act has been stalled in the Senate Banking Committee since January 2026.