The long-standing standoff between U.S. crypto firms and banks over stablecoin yield regulation may be entering its final chapter. Both sides are quietly reviewing a revised compromise under the Digital Asset Market Clarity Act this month, with multiple informed sources confirming a new round of talks has begun.
Coinbase Leads Opposition to Blanket Passive Yield Ban
An earlier draft from Senators Thom Tillis and Angela Alsobrooks banned both direct and indirect passive yield on stablecoin balances, allowing only narrowly defined activity-based rewards. That version drew fierce pushback from Coinbase, Stripe, and other major players. Coinbase chief legal officer Paul Grewal told FinTech Weekly a yield deal is “very close,” though the March 23 draft still “bans passive yield on stablecoin balances directly or indirectly.” CEO Brian Armstrong has accused large banks of “undermining” President Trump's crypto agenda by supporting language that would kill the 4–5% yields generating an estimated $1.35 billion in annual revenue for the exchange. Armstrong has argued that even allowing yields merely passes through Treasury returns already required under the 2025 GENIUS Act, which mandates stablecoins be fully backed by cash or short-term U.S. government debt.
White House Report Leans Toward Coexistence
An unpublished White House research report is expected to conclude that banks “should not view stablecoin yield offerings as a competitive threat,” according to crypto adviser Patrick Witt. He told Yahoo Finance that reward programs on fully backed stablecoins “do not undermine the banking industry's business model.” Yet banking groups remain aggressive: community banks warn yield-bearing stablecoins could siphon “billions from insured deposits,” while some Wall Street institutions label them “shadow deposits” that could drain up to $500 billion from the system by 2028.
Committee Vote Could Shift Focus to DeFi and Token Classification
If the yield dispute is neutralized in committee this month, lawmakers and lobbyists expect the Clarity Act debate to pivot to unresolved issues around DeFi rules, tokenization regimes, and which tokens fall under securities versus commodities law. With stablecoins like USD Coin — market cap exceeding $70 billion and trading near $1 — now central to both payments and on-chain yield strategies, the bill's fate will determine how far U.S. investors can chase “digital dollar” returns without leaving the banking system. Odds trackers quoted by Coingape put the legislation's 2026 passage probability at roughly 64%, up sharply since February.