Key facts
- U.S. banking groups are pushing for amendments to the CLARITY Act's stablecoin yield provisions.
- Concerns exist that the current language could allow stablecoins to act as substitutes for bank deposits.
- Senator Thom Tillis has proposed 'circuit-breaker' language to address potential deposit flight.
- The CLARITY Act aims to establish a comprehensive regulatory framework for digital assets.
- A House of Representatives hearing on the CLARITY Act is scheduled for July 17.
U.S. banking groups, including the American Bankers Association and the Independent Community Bankers of America, are urging amendments to the stablecoin yield provisions in the Digital Asset Market Clarity Act (CLARITY Act). They argue the current wording is too ambiguous and could allow stablecoins to function as substitutes for bank deposits, rather than solely for transactions. Senator Thom Tillis has proposed including 'circuit-breaker' language to enable regulators like the FDIC and OCC to intervene if systemic deposit flight to crypto is detected. Despite these concerns, Senator Cynthia Lummis indicated that the CLARITY Act text is expected to be introduced soon, with a potential Senate floor vote by the week of June 20th. The bill faces a race against time before the Senate's August recess, and a House of Representatives hearing is scheduled for July 17.