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- Stablecoin yield remains the central sticking point in CLARITY Act negotiations.
- Banking groups and crypto firms are still revising legislative language.
- A March agreement looks unlikely, but talks remain active.
Negotiations over stablecoin regulation in the proposed CLARITY Act are heating up in Washington, with banking groups and crypto advocates still divided over whether stablecoins should offer yield. Despite growing public tension and speculation of a breakdown, insiders suggest talks remain active, and a final compromise is still on the table — just not as soon as some policymakers hoped.
Negotiations Continue Behind Closed Doors
According to reporting shared by Eleanor Terrett of Fox Business, discussions between financial institutions and crypto representatives are ongoing. Both sides are reportedly continuing to revise draft language related to stablecoin yield provisions, signaling that negotiations have not collapsed despite rumors circulating online.
Representatives from major banking groups — including the American Bankers Association, the Independent Community Bankers of America, and the Bank Policy Institute — were said to be surprised by claims that talks were nearing failure. Sources close to the process indicated these organizations do not share the pessimistic view expressed by unnamed commentators and have communicated that stance to the White House.
The continued exchange of legislative text suggests both sides still see room for compromise, even as disagreements over yield mechanics remain unresolved.
March Deadline Appears Increasingly Unlikely
Earlier expectations from policymakers suggested a deal might be reached before March, allowing the broader market structure bill to move forward. Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets, had reportedly expressed optimism about completing negotiations within that timeline.
However, insiders now indicate that deadline is unrealistic. While discussions remain productive, the complexity of balancing financial stability concerns with innovation incentives means a near-term agreement is unlikely.
Industry Voices Urge Continued Compromise
Despite delays, some industry leaders remain supportive of the negotiation process. Tech investor and policy adviser David Sacks publicly praised Witt’s efforts to bridge the divide, noting that the crypto sector has already made concessions on yield provisions and urging banks to reciprocate.
This dynamic reflects the broader challenge facing lawmakers: crafting rules that allow stablecoins to compete with traditional financial products without introducing systemic risk.
Also Read: 5 Reasons Why the CLARITY Act Could Actually Boost Coinbase Profits
For now, the CLARITY Act negotiations appear to be in a slow but steady phase rather than collapsing. While a March breakthrough seems unlikely, continued dialogue suggests both sides recognize the importance of regulatory clarity for stablecoins and the broader digital asset market.
If progress continues, the final legislation could still emerge later this year — but only after more compromise from both the crypto industry and the banking sector.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
