Coinbase opposes Senate plan to curb stablecoin rewards

Coinbase has informed Senate negotiators it cannot support the latest Clarity Act draft that would restrict stablecoin yield, according to people briefed on the discussions. The company conveyed its position earlier this week as lawmakers circulated updated language.

The bipartisan text distributed Monday would prohibit crypto exchanges from paying rewards on customers’ stablecoin balances. It would also limit incentive structures by restricting access to transaction size data, making it harder to calculate or pass through rewards. Provisions on stablecoin yield are being led by Senators Thom Tillis and Angela Alsobrooks, according to people familiar with the talks.

Banks have argued that offering yield on idle stablecoin balances could draw deposits from traditional institutions that use those funds to make loans. Crypto firms contend that allowing limited rewards on stablecoins would expand customer options and create new business lines for financial institutions.

The White House has convened multiple closed-door meetings in recent weeks to seek a compromise between the banking sector and the crypto industry. Negotiators have not reached agreement. As we reported earlier, President Trump said banks were undermining the GENIUS Act and warned they should not hold the CLARITY Act hostage, urging Congress to finish market-structure legislation and let Americans earn more on their money.

“Bipartisan compromise is necessary for the Clarity Act to pass,” Senator Cynthia Lummis wrote on X. “We’re working around the clock to ensure stablecoin rewards are protected and to prevent deposit flight from community banks.” Patrick Witt, executive director for the President’s Council of Advisors for Digital Assets, described “plenty of uninformed FUD” on social media this week, adding, “It’s all going to work out. Bullish.”

The outcome carries financial weight for Coinbase and its peers. Coinbase reported $1.35 billion in stablecoin revenue in 2025, much of it from distribution payments tied to its partnership with Circle on USDC. Any provision that restricts or eliminates rewards could reduce that revenue stream.

Coinbase shares closed at $181.10 on Wednesday, little changed on the day. The stock is down 7.4% over the past five days and 41% over the past six months.

Coinbase had previously withdrawn support for an earlier Senate Banking Committee draft in January that included a ban on stablecoin yield offerings. At the time, CEO Brian Armstrong argued that banks were lobbying to limit competition from crypto platforms.

Talks on stablecoin yield remain active, with negotiators seeking language that can draw bipartisan support and address concerns from both banks and crypto companies.