Coinbase and Treasury Secretary Push for Stablecoin Yield Clarity

Third-party rewards on stablecoins are currently permitted under the GENIUS stablecoin legislation, which prohibits issuers from paying interest but does not prevent platforms like Coinbase from providing rewards. Traditional banks argue that these yield mechanisms divert deposits from the community banking sector. A White House economic analysis released this week concluded that stablecoin rewards pose minimal threat to bank lending activities.

The Senate Banking Committee will vote on the Digital Asset Market CLARITY Act before the end of April. The legislation is designed to resolve the status of these rewards. Coinbase CEO Brian Armstrong, who withdrew support in January, now endorses the bill, calling it a "strong bill."

Treasury Secretary Scott Bessent wrote an opinion piece for The Wall Street Journal this week, urging immediate action, stating, "Senate floor time is scarce, and now is the time to act."

To pass, the bill must be harmonized with a version developed by the Senate Agriculture Committee and secure 60 votes on the Senate floor. Senator Cynthia Lummis, who will not seek re-election and whose term ends in January 2027, stated that this is the last chance for the legislation to pass until 2030 at the earliest.

Coinbase has been granted a national bank trust charter by the Office of the Comptroller of the Currency, joining Paxos, Ripple Labs, BitGo, Circle, and Fidelity Digital Assets.