Summary
- Senator Thom Tillis said he plans to release a compromise draft as soon as this week to resolve the debate over stablecoin interest payments.
- The draft addresses whether the CLARITY Act should allow deposit rewards (interest) for stablecoin holders, and banks have reportedly raised objections.
- Banks oppose stablecoin interest payments over concerns about deposit outflows, while crypto companies argue that a ban on interest payments would hinder innovation.
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The fight over whether stablecoin holders should be allowed to earn interest remains unresolved, but US lawmakers may soon unveil a compromise proposal that could shape the next phase of the debate.
The Block reported on Aug. 14 that Senator Thom Tillis, a North Carolina Republican, plans to release a draft agreement as soon as this week aimed at settling the dispute over stablecoin interest payments.
Tillis has been working with Senator Angela Alsobrooks, a Maryland Democrat, to align related provisions in the CLARITY Act, legislation focused on digital-asset market structure. At the center of the dispute is whether stablecoin holders should be allowed to receive deposit-like rewards, or interest, an issue that has sharply divided banks and crypto firms.
"The legislative text is largely in place," Tillis said. If talks proceed smoothly, the draft could be released this week.
The proposal has already been shared with both banking groups and crypto companies, the report said. Banks have raised objections, though the basis for their opposition has not been disclosed. Tillis has also left room for further revisions.
The stablecoin interest question has emerged as the biggest sticking point in the CLARITY Act, a key bill to establish a regulatory framework for digital assets. The GENIUS Act, passed last year, barred stablecoin issuers from directly paying interest but did not restrict third-party platforms such as exchanges from offering yield.
Banks argue that allowing interest on stablecoins could lead to structural disruption, including deposit outflows. Crypto companies counter that banning such payments would stifle innovation and could instead open new business opportunities for banks.
The White House has held several closed-door meetings this year to narrow differences between the two sides, but no agreement has been reached.
Tillis also mentioned the possibility of hosting a public discussion in Congress with banking and crypto industry representatives, described as a "crypto-palooza."
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
