Coinbase has warned lawmakers it may withdraw support for the CLARITY Act of 2025. The company’s concerns center on provisions that could restrict stablecoin rewards.
According to a Bloomberg report, Coinbase issued a serious warning regarding the bill. The company stated that if the stablecoin rewards limits remain in place, it would reevaluate its support for the bill.
The Digital Asset Market Clarity Act, or CLARITY Act, is being crafted by the US Senate Banking Committee. The US Senate Banking Committee has scheduled a markup session for the bill on Thursday.
Coinbase expands USDC yield strategy
Coinbase has emphasized the importance of stablecoin rewards for its business. In Q4 of 2025, the company generated $247 million from stablecoins and $155 million from blockchain rewards.
Stablecoin rewards, like those earned from holding USDC, have become vital for crypto exchanges. For Coinbase, these rewards represent a major revenue source.
The company has applied for a national trust banking charter. If granted, it would allow Coinbase to offer yield on stablecoins within a regulated framework.
The banking sector, however, does not agree with Coinbase’s stance. According to the lobbyists, such rewards are restricted by the regulated financial institutions.
There are concerns that high yields from stablecoins could harm traditional banking. Critics believe it could divert deposits away from banks, affecting community lending and stability.
The US Treasury has already sent warnings about the threat of the mass adoption of stablecoins. Estimates suggest that the banking industry could lose billions of dollars.
Crypto supporters, including Stand With Crypto, have rallied public support around the issue. Stand With Crypto stated that more than 135,000 emails have been sent to US senators urging them to protect stablecoin rewards in the bill.
CLARITY Act could stall over stablecoin rewards limits
The argument draws on the GENIUS Act that was implemented in 2025. The legislation banned stablecoin issuers from providing yield to token possession and did not address third-party platforms, such as Coinbase.
The report by Bloomberg draws attention to the increasing regulatory uncertainty. The CLARITY Act tries to seal the loopholes existing within the past legislation, but there is also a limitation of rewards, which has been a controversial topic.
The next markup session by the Senate Banking Committee is essential. However, if the bill contains such restrictions, it may slow down its overall development.
Analysts project that the bill might not go through Congress until 2027 or 2029. The impending midterm of the 2026 elections might make it difficult to pass the bill through bipartisanship.
Nevertheless, Senate Banking Committee Chair Tim Scott has remained optimistic. He is hopeful that the bill can pass earlier, yet the case of the stablecoin reward is a major challenge.
The ongoing controversy highlights the conflict between regulatory control and crypto innovation. The future of digital assets within the US financial system will be determined by how lawmakers treat stablecoin rewards.