Lawmakers have reportedly circulated proposed changes to stablecoin yields to a small group of banking and cryptocurrency industry representatives.
A select group of banking and crypto industry executives will reportedly consider amended legal language governing stablecoin yields in a closed session over the next two days, in hopes of passing the CLARITY Act in the Senate by the end of April.
The latest round of reviews will be held on a staggered basis, Politico reports. Cryptocurrency companies will be the first to consider the revised language, with consideration expected as early as Thursday, followed by banks on Friday, the people said. However, timing is subject to change.
Access to the draft remains tightly controlled. Officials who visited the Capitol last week were allowed to view the text on the spot, but were not allowed to keep copies, underscoring the sensitive nature of negotiations over the CLARITY Act.
Debate intensifies over stablecoin yields
The proposal, drafted by Thom Tillis and Angela Alsobrooks, is part of the government’s efforts to resolve an ongoing dispute between traditional financial institutions and crypto companies over whether stablecoins should be allowed to offer yield.
Banks argue that allowing high-yield stablecoins could create competitive and regulatory imbalances, while crypto companies like Coinbase (COIN) argue that such features are essential for innovation and user adoption, leading to the standoff over the CLARITY Act.
Coinbase and Circle (CRCL) have a 50/50 revenue sharing agreement regarding USDC (USDC), with Circle being the official issuer of the stablecoin. COIN stock was down 1.6% in midday trading Thursday, while CRCL stock was down nearly 4%. Retail sentiment for both crypto-related stocks on Stocktwits has remained in “bearish” territory over the past day.
Lawmakers seek final agreement
The revised draft followed a series of staff-level meetings between parliamentarians and representatives from both industries to gather feedback on previous versions of the agreement.
Some participants in the process hope the updated language will serve as a final proposal from lawmakers, the report said. However, it remains unclear whether this will satisfy both parties or lead to further amendments.
The negotiations come at a time when the digital asset market is said to be experiencing a “crypto winter.” The overall cryptocurrency market has lost nearly $2 trillion since October, with Bitcoin (BTC) trading in a range between $65,000 and $70,000, more than 45% below its all-time high of more than $126,000 set in October.
BTC price has fallen by 2.3% in the past 24 hours to around $66,900. On Stocktwits, retail sentiment regarding this apex cryptocurrency has trended in “bearish” territory over the past day, while chatter has increased from “low” to “normal” levels.
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