U.S. Senator Thom Tillis (R-N.C.) intends to release a draft agreement this week to resolve the ongoing dispute over stablecoin yields within the proposed Clarity Act, according to a Monday report from Politico.
Tillis has been working alongside Senator Angela Alsobrooks (D-Md.) to draft legislative language that would settle whether cryptocurrency companies can pay interest on idle stablecoin balances.
"I think the language has come together well," Tillis told Politico on Monday. He added that the text might be made public later this week if negotiations continue smoothly.
The battle over stablecoin rewards
The current legislative battle centers on whether third-party platforms, such as crypto exchanges, should be permitted to offer rewards on stablecoin holdings. While the previously passed GENIUS Act prohibits stablecoin issuers from paying interest, it does not explicitly ban third-party platforms from doing so.
U.S. banks have opposed the idea, arguing that allowing these rewards would trigger a structural disruption by draining deposits from traditional financial institutions.
Crypto firms, including Coinbase, argue that a ban would stifle innovation. These companies maintain that the practice could create new business opportunities for banks rather than just crypto-native entities.
While the latest draft has been reviewed by both banking and crypto representatives, the report indicates that banks have already pushed back against the proposal. Tillis indicated he is willing to make further amendments to the text to reach a consensus.
The White House has held several closed-door meetings since the start of the year to facilitate a resolution, but neither side has reached an agreement.
Even if a compromise is reached, the Clarity Act faces a difficult legislative path. The bill must first pass a vote in the Senate Banking Committee and then undergo reconciliation with the Senate Agriculture Committee before reaching a full floor vote.
Tillis also suggested the possibility of hosting a "crypto-palooza" on Capitol Hill, an event designed to bring both banking and crypto industry representatives together to break the current deadlock.