Possible CLARITY Act deal targets stablecoin yield concerns
A reported deal between the White House and US lawmakers is focused on rules for stablecoin yields, a key issue for the banking industry.
The proposal would limit interest payments on certain stablecoin holdings, especially so-called “passive balances.” Lawmakers say this approach aims to support innovation while reducing the risk of money leaving traditional banks.
Details of the agreement are still unclear, and the crypto industry is expected to review the proposal before it is finalized.
The issue of yield-bearing stablecoins has been a major sticking point. Banks worry that higher returns on stablecoins could pull deposits away from the traditional banking system, where interest rates are typically very low.
Supporters of the bill argue that clear rules could strengthen both the crypto sector and the broader financial system by bringing more activity into regulated markets.
Featured image from: cointelegraph.com