Negotiations over the anticipated Cryptocurrency Market Structure Bill have suffered a new setback, with cryptocurrency exchange Coinbase reportedly telling the Senate Office that it cannot support the latest language inserted into the Clarity Act.
The dispute centers on newly amended provisions governing stablecoin yield arrangements, a key issue that has been the subject of months of consultations on Capitol Hill.
Coinbase says no to late-stage infringement
The Senate’s updated document would limit how stablecoin yield programs operate, limit structures that attempt to mirror bank deposit products, and tighten the scope of other activities allowed.
The draft leaves open questions about the mechanism for classifying activity-based stablecoins and how transaction reward programs will be handled.
This uncertainty, coupled with what some in the industry see as more restrictive language, led Coinbase to notify lawmakers this week that it could not support late-stage compromise language.
The move marks a milder but still significant reversal from Coinbase CEO Brian Armstrong’s more forceful opposition in January, which previously delayed the bill’s price hike.
Industry divided over draft CLARITY law
Beyond Coinbase, industry reaction to the new draft has been mixed. A major industry group told Crypto in America that the revised language represents a significant departure from discussions with the White House and that the language is more restrictive for the crypto sector.
In contrast, leaders of another industry association characterized the provision as largely as expected, arguing that it strikes an acceptable balance by preserving rewards while preventing interest-like stablecoin offerings.
“This is the best possible outcome,” the official said, noting that the new draft appears broader than an earlier proposal by Sens. Thom Tillis and Angela Alsobrooks, and expressing confidence that “people will still get their rewards.”
Coinbase stock, which trades under the ticker “COIN,” closed Wednesday at $181 per share, down nearly 5% from its opening price of more than $190.
Featured image from OpenArt, chart from TradingView.com
