Key Highlights
- Senators and the White House reached a tentative deal on stablecoin bill language tied to yield-bearing tokens.
- The compromise aims to balance crypto innovation with concerns over bank deposit flight.
- Lawmakers still plan to review the draft with banking and crypto industry groups before moving ahead.
Senators negotiating a long-stalled stablecoin bill said they have reached a tentative agreement with the White House on language meant to address one of the most contentious issues in the debate: whether stablecoin issuers or platforms should be allowed to offer yield to token holders.
According to a Politico report, Sen. Thom Tillis and Sen. Angela Alsobrooks said the agreement in principle could help move the legislation forward after months of delay in the Senate Banking Committee. The dispute over yield has been one of the main obstacles, pitting bank concerns about deposit flight against crypto firms seeking broader flexibility for stablecoin products.
Alsobrooks said the proposal is designed to strike a balance between allowing innovation and limiting risks to the traditional banking system.
Banking concerns shaped the talks
The argument at the center of the negotiations is whether yield-bearing stablecoin programs could encourage users to move money out of bank deposits and into digital dollar products.
Both Tillis and Alsobrooks have indicated they take those concerns seriously. Wall Street groups have warned that allowing stablecoins to offer returns similar to interest could pull funds away from banks, especially if such products become widely available through exchanges or consumer-facing apps.
According to Alsobrooks, the emerging language would seek to prevent yield payments on what she described as a “passive balance,” though the exact terms have not yet been disclosed.
Proposal still needs industry review
Even with an agreement in principle, the proposal is not final. Tillis said lawmakers still need to vet the language with both banking and crypto industry participants before any broader deal is locked in.
That leaves open the possibility that the compromise could still face resistance from either side. Banking groups may push for tighter limits, while crypto firms could object if the language is seen as too restrictive on product design or distribution.
The White House has not publicly detailed its position on the new draft language. However, through an X post, Patrick Witt, a top White House crypto policy adviser, credited Tillis and Alsobrooks for bridging the partisan divide to tackle a difficult issue.
Why it matters
The talks mark the clearest sign in months that negotiators may be nearing a path forward on federal stablecoin legislation.
The bill has been stuck since January, with the yield issue emerging as a central sticking point. A tentative White House-backed compromise does not guarantee passage, but it suggests lawmakers are trying to narrow one of the biggest policy divides before the legislation returns to active consideration.
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