Closed-door negotiations on U.S. stablecoin regulation face mounting time pressure. The March 1 internal White House deadline is fast approaching, yet key parties—including Coinbase, Ripple, bank representatives, and White House officials—remain far apart on core provisions. According to Crypto In America, talks around yield restrictions in the CLARITY Act have stalled after three rounds of discussions. Draft language circulated last week failed to close the gap.
Activity-Based Rewards Remain the Sticking Point
The main dispute centers on activity-based rewards. Yields on idle stablecoin balances are already excluded from the proposed restrictions, but incentives tied to on-chain transactions still divide negotiators. Banking groups argue such rewards could drain deposits from traditional accounts; crypto firms counter that limits would reduce market competitiveness. The deadlock has persisted since December with no sign of a breakthrough.
White House officials circulated a separate draft of the CLARITY Act during the latest closed-door session. Participants included Coinbase, Ripple, and venture capital giant Andreessen Horowitz. Officials reiterated an internal March 1 deadline to move Senate discussions forward, but the negotiating table still lacks a mutually acceptable compromise text.
Prediction Market Odds Keep Sliding
Betting markets clearly reflect the fading optimism. Polymarket now assigns only a 51% chance of CLARITY Act passage in 2026, down 14 percentage points. Kalshi data shows just a 35% probability of passage before May. Sentiment weakened after Donald Trump omitted crypto from his State of the Union address—a signal investors interpret as a lower policy priority.
Blockchain analytics firm Santiment noted that investors previously viewed the CLARITY Act as critical to defining agency oversight, but expectations have cooled. Geopolitical tensions and new global tariff disputes are adding further pressure. Commentator 360trader said banks could legally issue stablecoins if the bill passes, while recent easing in U.S.–Iran tensions has given broader markets some relief.
On-Chain Data: Supply and Volumes Hit Records
The backdrop contrasts sharply with negotiating room inertia. Payments giant Stripe has reportedly quadrupled its stablecoin transaction volumes. Data cited by 360trader shows stablecoin supply surpassed $300 billion in 2025, processing $33 trillion in transactions. These numbers indicate that even with policy ambiguity, stablecoin adoption within traditional financial infrastructure continues accelerating.
Imprisoned FTX founder Sam Bankman-Fried posted on social media that the bill would mark a milestone for crypto regulation. He revealed that during the FTX era he had supported similar efforts to limit SEC authority under Gary Gensler.
Talks are ongoing. All sides now await direction before the White House deadline.