New CLARITY Act Proposes Restrictions on Stablecoin Yields and Rewards
- The CLARITY Act’s latest draft prohibits platforms from offering yield or interest on stablecoins, impacting digital asset service providers.
- Users will not receive any yield from depositing stablecoins that function similarly to bank deposits, limiting potential revenue for platforms.
- Activity-based rewards are allowed, including loyalty programs, but must not be equivalent to deposit interest.
- The US SEC, CFTC, and Treasury will define permissible rewards and establish anti-evasion rules within one year.
- Industry leaders describe the approach as restrictive, potentially affecting top DeFi protocols and exchanges that offer passive returns.
The new legislative language is seen as a departure from earlier discussions with the White House, leading some to view it as overly narrow regarding crypto regulations. The proposed restrictions aim to ensure stablecoins do not operate like interest-bearing accounts while allowing limited reward structures based on user activity.
With a markup expected in mid-April, the crypto industry advocates for the passage of the CLARITY Act despite concerns over its restrictive nature on yields and rewards.(Source)
