A standoff over the CLARITY Act has escalated between the White House and Coinbase. A Trump crypto advisor warned that a future Democratic administration could treat crypto far more harshly than the current draft. In response, Coinbase confirmed it is working on a coordinated counterproposal to preserve stablecoin yield, while other critics raised concerns over developer protections and Bitcoin’s tax treatment.
Tensions have intensified between the White House and Coinbase regarding the latest CLARITY Act draft. On March 28, Patrick Witt, executive director of the President’s Council on Digital Assets, issued a veiled warning aimed at the exchange’s position.
He stated a future Democratic administration would likely treat stablecoin yield, DeFi, and crypto worse than the current compromise. This marked a reversal from an earlier White House statement that downplayed the exchange’s alleged opposition.
Coinbase confirmed the stalemate. David Duong, the exchange’s head of global investment research, said the industry was “working on a coordinated counterproposal” to “preserve sustainable stablecoin rewards.”
Policy chiefs also raised concerns beyond stablecoin rewards. They highlighted issues with the draft’s treatment of DeFi developer protections and crypto double taxation.
Jake Chervinsky, CEO of Hyperliquid Policy Center, cautioned, “Those sections must be fixed, or the bill doesn’t work for DeFi.” Separately, legal experts took issue with a proposal offering a tax exemption only for stablecoin transfers, not Bitcoin.
The advocacy group Bitcoin Policy Institute added strong opposition, noting the draft leaves double taxation on Bitcoin mining in place. “We need a strong community push back,” the group stated.
Coinbase projects the stablecoin yield issue could be resolved within three weeks. Duong indicated a Senate Banking markup could then occur in the second half of April, with potential final passage in early May.
