The updated draft of the Clarity Act in the US Senate has sparked alarm in the crypto sector by prohibiting returns on stablecoins to protect traditional bank deposits. We analyze the impact of this measure on Web3 innovation and the DeFi ecosystem.
A new revision of the Clarity Act draft has caused concern among players in the Web3 ecosystem. Following its publication, market attention has focused on an amendment that reverses the direction of the regulation by including a prohibition that limits the possibility of earning returns on stablecoins simply by holding them in a wallet.
This ban, as this media outlet has reported, arises due to the concern of the traditional financial system, which perceives these digital assets as a risk of competition to bank deposits.
Banks fear the possibility of paying returns to stablecoin holders, as some savings might be drawn to platforms with faster processes and lower operating costs. Faced with this scenario, legislators are seeking to establish a framework that maintains market equilibrium, proposing that stablecoins be used... exclusively as payment instruments, without functions that might resemble financial or savings products.
Trade stablecoins on Bit2Me: sign up nowThe Clarity Act and its stance on stablecoin rewards
As this outlet has been reporting, the main sticking point in the Clarity Act text has been, for months, the interpretation of what constitutes a return on stablecoins.
However, according to reports stemming from closed-door reviews at the Capitol on Monday, the new version of the regulations is unequivocal on this point. prohibiting any payment or reward based solely on the volume of assets deposited into a digital wallet. The intention, according to lawmakers like Angela Alsobrooks and Thom Tillis, is to prevent stablecoins from directly competing with bank savings accounts. Days earlier, Alsobrooks had spoken about the importance of moving toward regulatory clarity in the crypto market, stating that, to achieve this, both sides—the banking sector and the cryptocurrency industry—needed to make sacrifices in order to reach an acceptable compromise.
Now, according to the reports from experts like Eleanor Terrett, presenter of Crypto in AmericaThe current technical distinction in the draft law is generating significant legal uncertainty. The draft indicates that the law would allow certain stablecoin reward programs, provided they are linked to "specific activities" by the user. The problem for the crypto industry is that the draft It does not precisely define which actions qualify as activity and what constitutes passive gratification.The crypto community believes this ambiguity is a minefield, since a platform that, for example, rewards those who use stablecoins in frequent transactions, is unclear whether that type of incentive could be considered a disguised financial return.
The banking sector has defended this position, arguing that crypto platforms should not offer products that mimic the architecture of savings accounts without being subject to the same reserve requirements and deposit insurance (such as those imposed by the FDIC). This compromise between the senators and the White House seeks to protect systemic stability, but the cost could be an operational stranglehold for companies that need to incentivize liquidity for their networks to function properly.
According to Terrett, some in the community believe that a lack of clarity on how to design legal incentive models puts the US crypto industry at a disadvantage compared to jurisdictions like the European Union or the United Arab Emirates, where regulatory frameworks are more detailed. Meanwhile, others in the crypto industry believe the current draft of the law is "the best possible result", considering the extent of the legislative debate.
The implications for the decentralized finance ecosystem
Another point of analysis in the current draft of the law is its impact on decentralized finance protocols. While the Clarity Act's yield cap focuses on stablecoin issuers, it affects liquidity across the entire market.
Furthermore, the current legislation also addresses the oversight of technological infrastructure, although final details regarding the classification of certain protocols are still pending. Members of the Banking Committee have indicated that the objective is to ensure financial integrity and prevent systemic risks. However, from the developers' perspective, imposing such rigid limits on value creation within blockchain networks could restrict the development of new cross-border payment and remittance tools.
Meanwhile, the legislative clock is ticking. The Senate Banking Committee has marked the period after the Easter recess, in April, to begin voting hearings. However, before the bill reaches the full Senate, it must pass critical tests, including resolving disputes over data protection and the prevention of illicit activities—issues on which the Democratic wing remains vigilant.
Meanwhile, the industry awaits the publication of an economic study conducted by the White House Council of Economic Advisers. According to preliminary reports cited by industry sources, this study analyzes whether there is a real risk of deposit flight from banks to stablecoins, or whether both sectors can coexist without cannibalizing each other. The release of this data will be crucial for lawmakers to decide whether to maintain the current restrictions established in the draft legislation or allow a controlled opening for digital rewards.
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