Expectations for Clarity Act Passage Surge on Stablecoin Compromise, Coinbase Support

▲ Stablecoin ©Godasol

As the stablecoin interest controversy finds a compromise, expectations for the passage of the U.S. cryptocurrency market structure bill are rapidly surging.

According to DL News on May 5 (local time), the U.S. Senate reached a compromise that restricts stablecoin interest payments but allows activity-based rewards. As a result, the probability of passing the U.S. cryptocurrency market structure bill, the Clarity Act, surged from 46% to 64% based on the decentralized prediction market Myriad.

The core of this agreement is a structure that prohibits the payment of returns that are “economically identical or functionally similar” to bank deposit interest, while allowing rewards based on actual activities such as trading, remittances, payments, and DeFi liquidity provision. This complements the ‘interest prohibition’ clause, which was controversial in the existing stablecoin regulation bill GENIUS.

Market reactions were mixed. While crypto investor Nic Carter assessed that “banks have won,” Scott Johnson of Van Buren Capital analyzed it as “not perfect, but acceptable.” However, the most notable reaction was Coinbase CEO Brian Armstrong’s statement, “Bring it to a vote,” which was virtually interpreted as a signal of support for the bill’s advancement.

Notably, Armstrong is the person who withdrew support and halted the bill’s deliberation earlier this year in protest of stablecoin regulations. This shift in support increased the possibility of the Senate Banking Committee resuming a vote, and within the industry, there’s even talk of a vote taking place in May. Summer Mersinger, CEO of the Blockchain Association, also commented, “This agreement is a significant turning point in legislative progress.”

However, variables remain until the bill’s passage. The Senate version must be reconciled with the bill already passed by the House, and legislative schedules could be delayed if the election season intensifies. Nevertheless, as expectations for resolving regulatory uncertainty grow, the market appears to be gradually shifting towards betting on policy momentum.

*Disclaimer: This article is for investment reference, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*