A US senator has urged a delay in the markup of the CLARITY Act until May to allow more time for discussions on stablecoin yield provisions. Concerns are rising that continued delays may prevent the bill from passing before the midterms in November.
Mentioned in this story
A US senator has reportedly urged Senate Banking Chair Tim Scott to delay the markup for the crypto market structure bill until May, as banking and crypto representatives need more time to resolve disagreements over stablecoin yield provisions.
US Republican Thom Tillis of North Carolina told reporters Monday that he does not expect the Senate Banking Committee to mark up the legislation, also known as the CLARITY Act, in April and has recommended that Scott schedule it for next month, according to Punchbowl News.
Tillis, who has been leading discussions between crypto and banking members, reportedly told Scott: “It’s very important to me not to accelerate things, to hear everybody, and give them a rational basis for what we do accept.”
Continued delays have sparked concern that the CLARITY Act may not pass before the US midterms in November, an event that US Treasury Secretary Scott Bessent said could reverse momentum of the bill.
Source: Brendan Pedersen
“I think if the Democrats were to take the House, which is far from my best case, then the prospects of getting a deal done will just fall apart,” Bessent said in March.
It comes the same day crypto advocacy group The Digital Chamber sent a letter to the Senate Banking Committee asking it to move the crypto market structure legislation forward to a Senate markup “as soon as the calendar allows.”
Related: Bessent ramps up pressure on Congress to pass CLARITY Act
The banking industry has raised concerns that allowing stablecoin yield could trigger significant deposit outflows from the traditional banking system, particularly at community banks.
The markup is being delayed to give banking and crypto representatives more time to resolve disagreements over stablecoin yield provisions.
US Senator Thom Tillis of North Carolina is urging the delay, recommending that the markup be scheduled for May.
If the CLARITY Act is not passed before the midterms, it may lose momentum and face increased challenges in future discussions.
The crypto market structure bill has advanced from the Senate Banking Committee, marking a significant step towards a floor vote. Bipartisan support has emerged, but unresolved issues remain that could affect Democratic backing.
Strategy plans to repurchase $1.5 billion in convertible debt and may sell Bitcoin to fund it.
Analyst Tice says Ethereum's rise to $4,000 is imminent, citing strong technicals.
Discover Myriad: A New Platform for Prediction Markets
Bitcoin struggles below $79K as inflation fears outweigh CLARITY Act progress.
Payward, Kraken's parent company, cuts 150 jobs as it prepares for an IPO.
See every story in Crypto — including breaking news and analysis.
It argues that those banks may not have enough balance-sheet flexibility to absorb such outflows without relying on higher-cost wholesale funding.
Meanwhile, Coinbase CEO Brian Armstrong and others have pushed for more favorable stablecoin provisions.
Last month, members of the banking and crypto industries were reportedly close to agreeing on enabling stablecoin rewards tied to crypto activity on third-party crypto platforms, but not for passive balances.
The Digital Chamber noted that it has now been more than 270 days since the House passed the CLARITY Act with bipartisan support.
“Clarity cannot wait,” The Digital Chamber’s government affairs director, Taylor Barr, said, adding: “More than 70 million Americans who have embraced digital assets deserve the regulatory clarity they have waited far too long for.”
Source: The Digital Chamber
Other members of the crypto industry have argued that moving the bill forward is more important than holding out for perfect terms.