The Senate Banking Committee is set for a highly contentious markup session on Thursday after lawmakers filed more than 100 amendments to the Clarity Act, the crypto market structure legislation. According to POLITICO, the amendment package includes dozens of proposals from Democrats along with revisions from Republican sponsors. Chairman Tim Scott is expected to introduce a manager's amendment that could replace the bill's current text.
Stablecoin Yield Restrictions Take Center Stage
An amendment from Jack Reed and Tina Smith would tighten restrictions on crypto firms offering yield-bearing stablecoin rewards, changing the standard from "functionally equivalent" to "substantially similar" to traditional bank deposit interest. The banking industry has been pushing hard — the American Bankers Association has sent over 8,000 letters to Senate offices since last week urging stricter limits. The current draft already bans third-party platforms from offering stablecoin rewards resembling deposit interest, but the Reed-Smith amendment would significantly harden that language and could become a defining vote during the markup.
Warren Drops 40+ Amendments Targeting Key Areas
Elizabeth Warren filed more than 40 amendments, making her the most active individual filer. One proposal would prevent the Federal Reserve from granting master accounts to crypto companies, effectively blocking many crypto firms from core U.S. banking infrastructure even if broader legislation passes. Warren also criticized the draft for lacking ethics safeguards that prevent federal officials from benefiting financially from crypto ventures while influencing regulation.
DeFi, Legal Tender, and Developer Protections
Beyond stablecoins and banking access, Mark Warner filed amendments focused on decentralized finance restrictions in Title III of the bill. Jack Reed also proposed an amendment explicitly prohibiting cryptocurrencies from being used as legal tender, including for tax payments. Other Democratic proposals include sanctions enforcement, restoring the DOJ's crypto enforcement team, and expanded ethics rules. Meanwhile, Catherine Cortez Masto offered a safe harbor provision to protect software developers from money transmitter liability if they do not control customer funds.
Thursday's markup now appears far more complicated than earlier expectations. While Republicans likely have enough votes to advance the bill through committee, a party-line outcome could weaken its chances on the Senate floor, where a 60-vote threshold likely requires bipartisan support. A previous markup attempt earlier this year collapsed over stablecoin yield provisions and crypto oversight disputes. With over 100 amendments on the table, this session could become one of the most consequential crypto policy debates in Congress this year.