A disputed Senate bill amendment to ban third-party stablecoin yields faces pushback from both banking and crypto groups. Banks warn of deposit flight risks, while crypto platforms argue yields are a core revenue source. Senator Thom Tillis stated his intent to release a proposal this week to break the stalemate and remains open to revisions, suggesting a fourth White House-mediated meeting may be necessary if disagreements persist.
A new draft agreement aiming to resolve the stablecoin yields controversy in the Senate’s crypto market structure bill is reportedly facing opposition. The amendment would ban third parties, like crypto exchanges, from providing stablecoin yield payments.
Senator Thom Tillis revealed his plan to make the proposal public this week. The goal is to break a deadlock that has stalled the bill since the House passed the CLARITY Act in July.
Banking lobbyists argue that allowing third-party yields could prompt customer deposit flight from traditional savings accounts. Crypto groups simultaneously oppose the ban because stablecoin yield is a major business for their platforms.
“I believe that the reason why the people are nervous is because they have not checked the main text,” Tillis stated. He added that the initiative reflects “real concerns about deposit flight when we are talking about yield.”
The Senator’s broader market structure bill would define how the SEC and CFTC regulate digital assets. Industry groups have been unable to find common ground despite three prior White House-mediated meetings.
Tillis expressed openness to changing the draft, stating, “That’s why we need to get to a mark that we are negotiating.” He noted progress on anti-evasion provisions but said enforcement language is still being worked on.
He indicated a willingness to broker a fourth mediated meeting if disagreements continue. “If we’ve still got a disagreement either from the banking or from the crypto side… then we are going to get the people in the room,” Tillis declared.
