Senate Deadlock Over Stablecoin Rewards Could Stall Digital Asset Clarity Bill

Senators are negotiating a narrow compromise over stablecoin reward rules as they try to advance the Digital Asset Market Clarity Act. Key negotiators — Democrats’ Angela Alsobrooks and Republican Thom Tillis — are drafting language to bar interest-like rewards on idle stablecoin balances while permitting limited, activity- or transaction-tied incentives (e.g., rewards for purchases or exchanges). Banking groups led by the American Bankers Association and voices such as JPMorgan’s Jamie Dimon pressure for strict limits to prevent deposit flight; crypto firms and exchanges push for clearer, workable allowance for incentive programs. The Office of the Comptroller of the Currency’s recent proposal (echoing aspects of prior legislation) added regulatory uncertainty but may leave design space for compliant exchange rewards. Committee votes in the Senate Banking Committee have been delayed pending talks with Coinbase, national banking groups and committee members; the bill likely must be merged with a related Senate Agriculture Committee package before a full Senate vote. Timing is tight because of other congressional priorities and outstanding Democratic demands (DeFi safeguards, CFTC/SEC appointments, and ethics limits), leaving the outcome and timetable uncertain. For traders: the dispute sustains regulatory uncertainty for stablecoins and could affect liquidity, yield products and exchange incentive programs — a limited compromise could reduce near-term regulatory risk, while a strict ban on idle-balance rewards would reshape yield offerings and flow between banks and crypto.