When Will the Major Cryptocurrency Bill, the Clarity Act, Be Passed? Coinbase Has Spoken

David Duong, Head of Global Investment Research at Coinbase, offered his current assessment of the CLARITY Act process, a critical topic regarding cryptocurrency regulation in the US.

According to Duong, as the bill resurfaced this week, the issue of stablecoin rewards once again became one of the main points of contention.

Last week, on March 20, Thom Tillis and Angela Alsobrooks announced that the Senate Banking Committee had reached an agreement in principle to pave the way for the bill. However, a new framework that emerged on March 24 indicated significant changes in the details of the regulation.

Accordingly, the new proposal only foresees the prohibition of returns paid on passively held stablecoin balances, while allowing more limited reward mechanisms tied to activities such as payment transactions or platform usage. This approach is said to aim to address banks’ concerns about deposit outflows while not completely stifling innovation in stablecoin products.

On the other hand, representatives of the crypto sector are working on a coordinated counter-proposal arguing for changes to the current draft to protect users and ensure the continuation of sustainable reward models. Duong notes that, according to the baseline scenario, regulations regarding stablecoin rewards could be clarified within the next three weeks. During this process, other outstanding issues are expected to be addressed, such as creating a viable “gateway” for the SEC and preserving the institution’s exemption authority.

Timing expectations are noteworthy. According to these expectations, the Senate Banking Committee could put the bill to a vote in the second half of April, and if the necessary conditions are met, the law could receive final approval as early as May.

*This is not investment advice.