US lawmakers delayed the CLARITY Act once more after a public battle broke out over who ought to management stablecoin rewards, in keeping with trade sources. Crypto costs stayed calm, however behind the scenes, rewards on digital {dollars} have grow to be the primary strain level for exchanges and banks.
The larger difficulty is how Washington needs crypto {dollars} to work in day by day life, whether or not they need to behave extra like cash in a financial savings account or simply one other piece of software program.
For normal customers, this debate hits near residence as a result of stablecoins are the closest factor crypto has to digital money. If the foundations change, the small return folks earn for holding these {dollars} on-line might shrink or transfer to platforms outdoors the US. Some firms are already getting ready for that risk.
It additionally helps clarify why giant companies at the moment are pushing again on payments they as soon as supported. Regulation has stopped being theoretical and has began touching actual balances.
What the CLARITY Act Is and Why Rewards Are the Drawback
The CLARITY Act is supposed to determine who regulates crypto within the US. You’ll be able to consider it as a rulebook that decides which referee runs the sport. We’ve a full explainer on the CLARITY Act draft if you wish to dig deeper.
53 banking associations simply wrote themselves a $6.6 trillion safety invoice.
They known as it the CLARITY Act.
Here’s what they are not looking for you to grasp.
Banks pay depositors 0.1% curiosity. Stablecoin issuers maintain Treasury payments incomes 4.5%. If stablecoins might cross… https://t.co/3UNjoucltx pic.twitter.com/sqDeduoVPa
— Shanaka Anslem Perera ⚡ (@shanaka86) January 15, 2026
The battle boils right down to rewards paid on stablecoins. A stablecoin is a digital token designed to remain close to one greenback, like USDC or USDT. Rewards are the small returns platforms pay customers, much like curiosity, usually generated from revenue on authorities bonds or lending.
Some lawmakers wish to restrict these rewards after they come from merely holding stablecoins. Supporters say this protects customers. Critics say it offers banks extra management.
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Who Positive factors and Who Loses If Rewards Get Reduce
Exchanges like Coinbase say rewards are why folks hold {dollars} in crypto apps moderately than conventional banks. Coinbase reported round $1.3 billion in stablecoin reward revenue in 2025, which helps clarify why it pulled assist for the invoice.
After reviewing the Senate Banking draft textual content during the last 48hrs, Coinbase sadly can’t assist the invoice as written.
There are too many points, together with:
– A defacto ban on tokenized equities– DeFi prohibitions, giving the federal government limitless entry to your monetary…
— Brian Armstrong (@brian_armstrong) January 14, 2026
Banks see issues in a different way. They argue that stablecoin rewards siphon funds from common accounts that pay little or no curiosity. That concern has already pushed regulators to tighten elements of the invoice, in keeping with a report by Stablecoin Insider.
For customers, the danger is straightforward. If US platforms can’t supply rewards, exercise might transfer abroad or into fewer firms. When competitors declines, charges normally worsen.
Why App Builders Are Getting Nervous
Many crypto apps run on open-source software program moderately than being owned by a single firm. You’ll be able to image it like a merchandising machine that runs by itself, the place no supervisor stands behind the glass deciding who can use it.
The CLARITY Act tries to separate individuals who construct software program from firms that maintain buyer cash. Builders assist that line. If it turns into blurry, some might cease providing their instruments to US customers.
That would cut back the amount of digital {dollars} shifting via these techniques, slowing lending and buying and selling exercise.
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The Security Argument Regulators Are Utilizing
Regulators usually level to previous failures like Celsius and BlockFi. These platforms promised rewards with out clearly explaining the place the cash got here from. When markets turned, customers misplaced entry to their funds.
Lawmakers try to guard customers with out constructing a system that solely giant firms can afford to observe.
Count on stronger language and heavier lobbying earlier than the subsequent vote. Till then, deal with stablecoin rewards as dangerous revenue and keep away from parking cash you want for hire or groceries simply to earn a bit of further.
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