CLARITY Act divides US banks on Stablecoin Rewardspos

Crypto journalist Eleanor Terrett has disclosed potential conflict among US banks on stablecoin rewards in the CLARITY Act.

Terret shared this on X, claiming that community banks now appear to be supporting the current draft. The post follows the recent pushback from banking advocacy groups against the draft legislation.

Major Banks Want Stablecoin Yield Completely Removed

According to Terrett, big banks with consumer-facing businesses are now pushing back on the final language of the Act. She claimed that a discussion with one of those banks shows they are not satisfied with the current draft.

The draft, which was a compromise after many weeks of deliberations, had restricted interest on stablecoin balances. However, it allows for stablecoin rewards based on user activity.

While the crypto community has welcomed this compromise as a way forward, major banks appear opposed to it. Terrett claimed that a larger bank believes the language of the compromise is too narrow. Also, crypto firms might be able to work around it.

The major banks reportedly want stablecoin rewards removed entirely. Trade groups representing the banks want to double down on lobbying with members of the Senate Banking Committee.

Signs of the trade groups’ efforts are already evident with a joint statement by banking industry groups on Monday. The groups claimed that the current language did not address the risks of stablecoin yield. They include the American Bankers Association and the Bank Policy Institute,

The major risk, according to banks, is deposit outflows by consumers who could opt to save in stablecoins. They claim this would affect lending and have a long-term impact on economic activity.

Crypto Firms Continue to Push for CLARITY Act

Meanwhile, major banks’ opposition to the current draft of the  CLARITY Act represents another setback. Many had expected that the Senate Banking Committee would proceed with the markup of the bill.

However, it is unclear what the next steps are now that banking groups have rejected the compromise. With only a few months before the midterm election, many believe it is now crunch time for the CLARITY Act. They are hoping for progress in May.

Despite the mounting pressure, support is also growing. More than 100 crypto firms recently signed an open letter calling on the Senate Banking Committee to complete the markup.

It also appears that the White House is in support of the legislation. Treasury Secretary Scott Bessent has already penned an opinion in the Wall Street Journal calling for the bill to be passed.

So far, the odds of the CLARITY Act passing in 2026 is 65% on Polymarket.  This represents an improvements in its odds, and the crypto market has reacted positively to that.

Bitcoin is trading around $81,000 after gaining over 20% in 30 days, while other cryptocurrencies are also in the green.