Coinbase is signaling that it may walk away from Washington’s flagship crypto market‑structure bill, warning lawmakers it will withdraw support for the CLARITY Act if the final text clamps down on stablecoin rewards beyond basic disclosure rules. The move heightens tension ahead of a critical Senate markup and puts one of the sector’s most influential firms at odds with banking lobbyists backing tighter limits.
Clash Over Stablecoin Rewards
According to Bloomberg, citing people familiar with internal discussions, Coinbase has told U.S. senators it will reconsider its backing if the CLARITY Act restricts yield programs for customers holding stablecoins such as USDC, except for transparency and disclosure requirements.
The exchange regards reward programs as central to its business model and to competition in the U.S. stablecoin market, where interest paid on balances has become a key source of income.
Several outlets cite that draft language under consideration could limit or effectively bar stablecoin rewards offered through regulated intermediaries, a stance supported by banking groups that argue such products drain deposits from traditional institutions.
Coinbase counters that rolling back these incentives would weaken U.S. innovation, citing earlier legislation such as the GENIUS Act, which affirmed the legality of stablecoin yields.
Stakes for the CLARITY Act
The CLARITY Act, which passed the House in 2025, aims to draw a line between the mandates of the Securities and Exchange Commission and the Commodity Futures Trading Commission and to define categories such as digital commodities, investment contracts, and permitted payment stablecoins.
The bill is scheduled for a Senate Banking Committee markup on January 15, a session that will decide how far new restrictions on DeFi features and stablecoin reward models will go.
Coinbase executives argue that overreaching limits on rewards and decentralized finance provisions would undercut the very market‑structure clarity the bill promises, by pushing activity offshore and narrowing options for U.S. users.
Institutional strategy chief John D’Agostino has said comprehensive market‑structure rules will likely take longer to finalize than standalone stablecoin legislation, but still projects CLARITY’s passage by 2026 if bipartisan momentum holds.
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