The future of the CLARITY Act, widely referred to as the crypto market structure bill, remains uncertain beyond the March 1 deadline set by the White House, with no anticipated progress between the banking industry and crypto representatives.
Key Obstacles in Crypto Bill Negotiations
Despite concerns that talks could be delayed, to report of Crypto In America suggests that discussions continue behind the scenes. Eleanor Terret, citing a banking industry source with direct knowledge of the talks, pushed back on the idea that the process was stalling.
According to the source, both sides are still actively discussing and contributing to the drafting of the legislative language and have never been firmly locked into a March 1 timetable. “Over-indexing on March 1 is a mistake,” the source said.
However, the tension remains. Another banking source acknowledged that while there is broad agreement in principle stablecoin balance should not earn interest, disagreements continue as to how this principle should be implemented.
According to this source, crypto companies are trying to create alternative mechanisms – such as membership programs, reward systems or staking terms – that can effectively replicate the annual percentage yield (APY) on stablecoin holdings. The source said:
There is a good principle that stablecoin balances should not earn interest, but crypto companies still try to support the APY on the balance through membership programs, rewards and stakes. I think that’s what holds the deal for now.
It is said that the representatives of banks for any loan or stacking activity to be clearly defined as “active”, “conscientious” and “time-bound”, meaning that income must be strictly linked to genuine investment performance and not to passive interest.
Banking eyes of the Senate March
On Capitol Hill, the focus is on the procedural steps. The Senate Banking Committee is reportedly considering possible pricing dates in the latter half of March.
Such a schedule would give negotiators several additional weeks to resolve outstanding issues, among others decentralized finance (DeFi) regulations and ethical concerns before the bill is brought to a possible vote.
Amanda Tuminelli, executive director of the DeFi Education Foundation, said recent DeFi debates have given way to the crop debate, but described the broader process as progress. He further noted:
I think things are moving and things seem to be closing, but DeFi has taken a back seat in the harvest conversation. We’re waiting for Senate Banking to announce the next markup date and the updated text, so I think everyone’s looking forward to seeing what the next bill looks like.
For now, the way forward depends on resolving the stablecoin yield controversy and finalizing legislative language that can satisfy stakeholders to move forward.
Featured image from OpenArt, chart from TradingView.com
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