Crypto exchange Coinbase told Senate lawmakers it opposes the latest compromise on stablecoin yields being discussed for the Senate’s crypto market-structure bill, Punchbowl News reported, citing four people briefed on the meeting.
Coinbase representatives raised concerns on Monday about language in the compromise that would restrict how stablecoin yields are paid. An earlier proposal circulating this week would have barred third parties, including exchanges, from paying stablecoin yields — a measure aimed at addressing banks’ worries about potential deposit flight.
Coinbase, one of the largest crypto lobbyists in the U.S., previously withdrew support for the bill in January, just before the Senate Banking Committee indefinitely postponed a markup to advance the legislation. Republican Senator Thom Tillis and Democratic Senator Angela Alsobrooks are leading the current bipartisan effort to move the bill forward, and talks are reported to be ongoing. Coinbase did not immediately respond to a request for comment.
Yield fight plagues Senate bill
Stablecoin yields are the central contention between crypto firms and banking groups over the Senate bill, which seeks to define regulatory approaches to crypto. The White House has convened at least three meetings to try to bridge differences, but no consensus has emerged.
Banking groups argue that exchanges paying stablecoin yields would create a loophole in the GENIUS Act — which bans stablecoin issuers from paying yield to holders — and could prompt deposit outflows from the banking system. For exchanges, stablecoin yields are a significant business line; the crypto industry contends the banking-sector risks are overstated and accuses banks of trying to limit competition.
Republicans are pushing to pass legislation before the midterm elections, warning that a change in Congress could stall momentum. The House passed its version, the CLARITY Act, last July.
Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets, posted on X that “plenty of uninformed FUD” has circulated and added, “It’s all going to work out. Bullish.” Republican Senator Cynthia Lummis also posted that lawmakers “can’t wait until 2030 for another chance” to pass the crypto bill and said bipartisan compromise is necessary to protect stablecoin rewards while preventing deposit flight from community banks.
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