Senators Thom Tillis and Angela Alsobrooks have finalized a compromise on stablecoin rewards ahead of the planned May markup of the CLARITY Act. According to Punchbowl News, the agreement followed months of talks involving lawmakers, the Treasury Department, and industry representatives.
Key Rule: Prohibition on 'Interest-Equivalent' Payments
The deal introduces a broad ban on payments that are “economically or functionally equivalent” to interest on bank deposits. At the same time, it allows rewards tied to platform activity, provided firms pass an “equivalence test.” Notably, the provision applies to exchanges and their affiliates, directly addressing loopholes in earlier legislation that only covered issuers.
Link to the GENIUS Act
The compromise builds on the GENIUS Act, signed into law by President Trump on July 18, 2025. That law prohibited interest payments by stablecoin issuers but left secondary market activities unregulated. The new text fills that gap and directs regulators to draft additional rules, including a new disclosure regime and a list of permissible reward activities. Regulators must also clarify how firms demonstrate compliance with the equivalence standard.
Outcome of Bank vs. Crypto Firm Negotiations
Senate Banking Committee Chairman Tim Scott said unified Republican support remains necessary before markup. Blockchain Association CEO Summer Mersinger called the agreement “a path cleared toward Senate markup,” bringing market structure legislation closer to advancement. Coinbase Chief Policy Officer Faryar Shirzad stated the outcome preserved user-based rewards, noting that banks secured tighter restrictions while crypto firms retained client incentive models. He also pointed to ongoing work on token classification, decentralized finance, and tokenization.
Discussions between banks and crypto firms continue, with a focus on stablecoins’ role within the financial system. As the May markup deadline approaches, unresolved provisions in the full CLARITY Act text will draw close industry scrutiny.