Sen. Thom Tillis is defending the CLARITY Act’s stablecoin-yield compromise after major banking groups argued that the latest language still does not go far enough to protect bank deposits.
In a post on X, Tillis said he and Sen. Angela Alsobrooks worked “on a bipartisan basis with all stakeholders” to address banking-industry concerns around deposit flight. He argued that banks had been directly involved in the process for months and that the final product was a compromise rather than a one-sided win for either camp.
Tillis framed the language as a middle path, saying the agreement keeps stablecoin rewards from functioning like interest on bank deposits while still allowing crypto firms to offer rewards tied to real customer activity. His sharpest line was directed at banks that want the language tightened further:
Some in the banking industry may not want either of these things to happen, and we respectfully agree to disagree.
The fight matters because stablecoin yield has been the biggest obstacle holding up the Senate’s version of the Digital Asset Market Clarity Act. A recent CLARITY Act compromise update already placed the Tillis-Alsobrooks deal at the center of the markup path, with passive stablecoin yield banned while activity-based rewards remain possible.
The banking lobby is not satisfied. The American Bankers Association, Bank Policy Institute, Consumer Bankers Association, Financial Services Forum and Independent Community Bankers of America issued a joint statement saying the proposed language “falls short” of fully prohibiting stablecoin yield and interest.
Their concern is deposit flight. Banks argue that if crypto platforms can use reward structures to mimic interest-bearing accounts, customers may move money away from traditional deposits. The same statement warned that yield-earning stablecoins could reduce consumer, small-business and farm lending by one-fifth or more, making the wording around rewards a major policy fight rather than a technical drafting issue.
Crypto firms see the line differently. The compromise bars rewards that are economically or functionally equivalent to bank-deposit interest, but it leaves room for incentives tied to payments, transfers, trading, platform usage and similar activity. That distinction is crucial for exchanges, wallets and stablecoin distributors that rely on rewards to drive adoption without turning stablecoin balances into savings-account substitutes.
The Senate Banking Committee’s next move will show whether the compromise can survive last-minute pressure. A recent CLARITY Act momentum story placed the bill back on a possible May markup path after months of delays tied to the stablecoin-yield dispute.
The industry has already started pricing the deal as progress. Coinbase executives backed the compromise, while crypto policy groups pushed lawmakers to move ahead with markup rather than reopen the yield fight. Banks, by contrast, are warning that any loophole could turn stablecoin products into direct competition for deposits.
Tillis’ post makes clear that Senate negotiators are trying to close the yield fight without reopening the entire bill. The agreement gives banks a ban on passive holding yield, gives crypto firms room for activity-based rewards and gives Senate Banking a workable text to move forward. The remaining risk is that another round of bank lobbying turns a narrow stablecoin dispute back into the bottleneck that stalls the broader market-structure bill.
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