Senate Revives Long-Stalled Clarity Act Bill

U.S. lawmakers are preparing to revisit long-delayed cryptocurrency legislation this week, marking a potentially important step toward establishing a federal regulatory framework for digital assets after months of stalled negotiations.

According to a Reuters report, the Senate Banking Committee is expected to hold an executive session on May 14 to advance legislation aimed at clarifying how cryptocurrencies are regulated in the United States. The renewed momentum follows a compromise between banking groups and crypto companies after discussions had reportedly stalled since January over disagreements tied to stablecoin rewards and competitive concerns.

Among its provisions, the proposal would establish clearer definitions for when digital assets should be treated as securities, commodities, or another classification entirely, potentially reducing years of legal ambiguity that has shaped enforcement actions and discouraged institutional participation.

For much of the crypto industry, legal clarity has become one of the sector’s highest priorities. Companies have argued that the lack of consistent rules has made it difficult to build products, attract institutional partners, and operate confidently within the U.S. market.

Stablecoin Rewards Remain The Key Battleground

A major sticking point in negotiations has centered on stablecoins and whether issuers should be allowed to offer rewards to users.

Under the reported compromise, companies would be prohibited from offering passive rewards to customers for simply holding stablecoins, reflecting concerns from banks that yield-bearing stablecoins increasingly resemble traditional deposit accounts. However, incentives tied to specific activity, such as payments or other transactional use cases, would still be permitted.

The distinction attempts to balance competing priorities between banks seeking to protect deposit-based business models and crypto firms pushing for flexibility to innovate around digital payments.

The proposed restrictions could force crypto firms to rethink customer acquisition and retention strategies that have increasingly relied on stablecoin yield products. Rather than rewarding users for passively holding digital dollars, companies may need to shift toward activity-based incentives tied to payments, trading, staking, or participation in decentralized networks.

Banks Push for Last-Minute Changes

Despite the apparent compromise, opposition from traditional financial institutions appears far from resolved.

Reports from Reuters and Bloomberg indicate that banking trade groups have mounted an eleventh-hour lobbying effort aimed at strengthening restrictions before the legislation advances.

According to Reuters, banking organizations are attempting to persuade Republican members of the Senate Banking Committee to support tighter provisions. Bloomberg separately reported that industry groups are seeking an amendment that would prohibit stablecoin issuers from offering any rewards whatsoever, including incentives tied to payments or user activity.

In a letter cited by Bloomberg, banking groups argued that existing carveouts “include exceptions that will enable evasion of the intended prohibition and incentive customers to hold and grow stablecoin balances at the expense of deposits.”

A Critical Week for U.S. Crypto Policy

While stablecoin legislation has advanced more quickly in recent months, broader market structure reform has proven more difficult due to disagreements over jurisdiction, investor protections, and the role of traditional financial institutions.

The upcoming committee session may offer one of the clearest signals yet on whether lawmakers are prepared to move comprehensive crypto legislation forward after years of delays.

For the digital asset industry, the outcome could shape how crypto businesses operate in the United States for years to come.