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▲ Stablecoin ©Godasol
Market expectations are at an all-time high as the passage of a key bill to establish a cryptocurrency regulatory framework in the United States is imminent. A dramatic compromise has been reached on the issue of stablecoin profit distribution, which has been a source of sharp conflict between the banking sector and the cryptocurrency industry, signaling a green light for the enactment of the bill.
According to the cryptocurrency media outlet Bitcoinist on May 2 (local time), Brendan Pedersen, a reporter covering the U.S. Congress, reported via the X platform that Senator Tom Tillis and Senator Angela Alsobrooks have finalized an agreement on the stablecoin profit provisions of the U.S. cryptocurrency market structure bill, the CLARITY Act. This issue was the biggest point of contention, with a fierce tug-of-war between the two sides over the past few months due to concerns from the traditional financial sector that stablecoin profits could undermine the competitiveness of the bank deposit system.
According to the final text (SEC 404), titled "Prohibition on Payment of Interest and Yield on Payment Stablecoins," cryptocurrency companies are prohibited from paying any interest or yield similar to bank deposit interest solely because customers hold payment stablecoins. This is interpreted as a safeguard to prevent deposit outflows from the existing banking sector and protect its systemic status.
However, exception clauses to ensure innovation in the virtual asset industry have also been clearly established. The bill legally allows the payment of rewards and incentives based on genuine activities or transactions, provided they are not functionally and economically identical to bank deposit interest. Specifically, activities such as network governance participation, validation, staking, and loyalty programs are included within the scope of legitimate compensation.
Immediately after the release of this compromise, Faryar Shirzad, Coinbase's Chief Policy Officer, pointed out on social media that much of the debate between the banking and cryptocurrency industries stemmed from imagined risks and unfounded concerns. He self-assessed that while the banking sector may have gained more restrictions on rewards, the industry has preserved the most critical right for Americans to earn rewards based on actual platform and network usage.
Finally, Shirzad emphasized that it is paramount for the U.S. to be at the forefront of the global financial system in the current fiercely competitive geopolitical era, urging that now is the time to focus all efforts on the swift passage of the U.S. cryptocurrency market structure bill, the CLARITY Act. Market participants are also offering positive outlooks, suggesting that with the overcoming of this major hurdle, the bill's passage through Congress is virtually in its final countdown.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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