Possible Compromise Emerging on Stablecoin Yield Payments in Senate Market-Structure Bill

Senator Tim Scott (R-SC), chair of the Senate Banking Committee, said he expects movement on the issue imminently. “I believe that this week the first proposal [will be in] my hand to take a look at,” Scott said, adding that a potential compromise on stablecoin yield could arrive “by the end of this week.”  A source familiar with the discussions indicated the White House may also signal progress, with an update potentially coming within days.

The dispute over yield-bearing stablecoins has become the central obstacle to advancing the Senate’s version of a broader crypto market structure bill. That legislation would establish a comprehensive federal framework for digital assets, effectively legitimizing much of the industry’s activity and providing regulatory clarity for token issuance and trading.  While the House passed its own market-structure bill, the Clarity Act, with bipartisan support last year, the Senate has struggled to reconcile competing priorities among lawmakers and stakeholders.

At issue is whether crypto firms should be permitted to offer yield—effectively interest payments—on stablecoin holdings. Although the GENIUS Act, enacted last year, did not prohibit such programs, banking industry groups have pushed for restrictions, arguing that yield-bearing stablecoins could siphon deposits away from traditional bank savings accounts.  Crypto firms, by contrast, view yield as essential to user adoption and product competitiveness.

The disagreement has already had tangible legislative consequences. In January, Coinbase withdrew support for the Senate bill over concerns it might restrict stablecoin rewards, prompting lawmakers to cancel a planned Banking Committee vote.  Subsequent White House-led negotiations between banking and crypto stakeholders failed to produce a consensus by their March target, and talks later stalled.

Related: FATF Report Highlights Risk of Stablecoins’ Use in Money Laundering and Other Crimes

More recently, however, senators including Thom Tillis (R-NC) and Angela Alsobrooks (D-MD) have reengaged with Senate leadership and the White House in an effort to broker a deal, per Decrypt.  Administration officials have also signaled the broader policy stakes. Speaking at the summit, Council of Economic Advisers acting chair Pierre Yared noted that while the “effects on the banking system are small,” the “effects on stablecoin adoption could be potentially large, depending on where this yield question falls.”

Even if a compromise on yield materializes quickly, lawmakers emphasized that time is becoming a significant potential obstacle to passage of the bill. With Congress expected to slow legislative activity ahead of the 2026 midterm elections, the window for passing a complex and potentially contentious crypto framework is narrowing, lawmakers at the summit said.

Representative Dusty Johnson (R-SD) warned, “We really are running out of time,” estimating that the Senate may have as little as six weeks to act.  He added, “We are very close to being out of time… I’m concerned we’re going to blow it without meaning to.”

Moreover, stablecoin yield is only one of several unresolved policy disputes. Senate Democrats have pressed for provisions addressing former President Donald Trump’s crypto-related business ventures, a demand the White House has reportedly rejected.  Lawmakers are also divided over how to regulate decentralized finance platforms, particularly whether to maintain carveouts that exempt certain DeFi activities from traditional regulatory requirements.  Industry stakeholders have warned that rolling back those exemptions could prompt them to abandon support for the bill altogether.

Scott acknowledged the breadth of these outstanding issues but expressed cautious optimism that they can be resolved before the legislative window closes. “Let us pray,” he said, underscoring both the urgency and uncertainty surrounding the effort.