U.S. lawmakers say negotiations over the long-discussed CLARITY Act are nearing a resolution, though the eventual compromise is unlikely to fully satisfy either the banking sector or the cryptocurrency industry.
Speaking at a summit organized by a major banking association in Washington, Senator Angela Alsobrooks indicated that discussions in Congress have reached an advanced stage. According to her, lawmakers are attempting to finalize a balanced regulatory framework despite strong pressure from traditional financial institutions seeking stricter limits on the crypto sector.
One of the central sticking points in the negotiations involves stablecoins and whether issuers should be allowed to pay interest on account balances. Alsobrooks said that many lawmakers view a ban on such interest payments as a firm boundary that cannot be crossed.
The concern is that offering yield on stablecoin balances could encourage depositors to move funds away from traditional banks. As the senator described it, some policymakers believe the scale of potential deposit outflows could be “colossal,” even though crypto companies argue the risk is overstated. She noted that she and Senator Thom Tillis are working to ensure such a scenario does not occur.
Congress is also preparing to revisit hearings in the Senate Banking Committee focused on a working draft of the CLARITY Act. Those hearings were previously postponed indefinitely following public criticism from the major crypto exchange Coinbase, which raised concerns about the proposal’s provisions.
Despite the disagreements, Alsobrooks said the negotiations appear to be moving toward a middle ground. The final framework, she suggested, will likely leave both banks and crypto firms “a little unhappy,” reflecting the challenge of balancing financial stability with technological innovation.
The senator also emphasized that financial products resembling traditional banking services must be backed by comparable safeguards. Without those protections, she argued, stablecoin providers cannot offer equivalent services to consumers.
The emerging compromise could include restrictions designed to prevent bank deposit outflows while still leaving room for innovation in digital assets. One idea under discussion would limit interest payments but allow certain exceptions tied to specific types of activity, though Alsobrooks did not specify what those cases might be.
Another member of the Senate Banking Committee, Senator Mike Rounds, suggested during the same event that stablecoin issuers might instead offer rewards linked to account usage rather than to the size of the balance held. Lawmakers are reportedly considering how to incorporate such mechanisms into the final proposal, though the position of the banking lobby on this approach remains unclear.
The debate over the bill comes as U.S. President Donald Trump has publicly urged Congress to move forward with the CLARITY Act, criticizing banks and calling for clearer rules governing the digital asset industry. Some projections suggest the legislation could reach the finish line by late summer 2026.
