CLARITY Act Gains Momentum as Coinbase CEO, Treasury Chief, and White House Push for Passage

Key Points

• Brian Armstrong of Coinbase has reversed his January opposition and now endorses the CLARITY Act
• Scott Bessent, Treasury Secretary, penned a Wall Street Journal opinion piece calling for immediate congressional action
• Senate Banking Committee has scheduled a vote on the legislation before April concludes
• Central dispute centers on stablecoin yield programs and whether exchanges like Coinbase can offer returns to users
• Senator Cynthia Lummis cautioned this represents the final opportunity for passage until 2030 at the earliest

The United States cryptocurrency sector is mounting an intensive campaign to secure congressional approval for the Digital Asset Market Clarity Act, with major industry leaders now rallying behind the proposed legislation following an extended period of legislative stagnation.

In a significant policy reversal, Coinbase’s Chief Executive Brian Armstrong declared on X earlier this week that “it’s time to pass the Clarity Act.” This statement marks a dramatic departure from his January position, when he pulled Coinbase’s endorsement, arguing the legislation was unacceptable “as written.” That withdrawal prompted the Senate Banking Committee to postpone a critical markup session.

Armstrong characterized the current iteration of the bill—refined through extensive negotiations among legislators, banking institutions, and cryptocurrency firms—as a “strong bill” worthy of support.

Treasury Secretary Scott Bessent amplified the administration’s stance through a compelling opinion piece published in The Wall Street Journal this week, urging immediate legislative action. “Senate floor time is scarce, and now is the time to act,” Bessent emphasized in his editorial.

The Senate Banking Committee, where the measure has languished for more than twelve months, has now committed to conducting a vote prior to April’s conclusion.

The Stablecoin Yield Controversy

The primary obstacle impeding progress involves the treatment of stablecoin yield programs. The GENIUS stablecoin legislation, enacted last July, prohibits stablecoin issuers from directly compensating holders with interest. However, the law does not prevent third-party platforms such as Coinbase from providing such rewards.

Traditional banking institutions contend that permitting such yield mechanisms would drain deposits from conventional financial entities, particularly affecting smaller community banks. Cryptocurrency advocates counter that restricting these reward programs would stifle technological advancement.

A White House economic analysis published this week concluded that stablecoin yield programs pose minimal threat to bank lending activities. Banking representatives disputed this assessment, arguing the report failed to adequately measure specific impacts on community banking institutions or deposit migration patterns.

According to a banking industry source who spoke with The Block on Friday, negotiations continue on more precise language governing yield restrictions to address lending sector concerns.

Another insider indicated the current priority involves “getting the banks in line to support the compromise,” noting: “Seems crypto is nearly there.”

Legislative Path Forward

Paul Grewal, Coinbase’s chief legal officer, indicated last week that lawmakers were “very close to a deal.”

Should the measure advance through the Senate Banking Committee, it must then be harmonized with the Senate Agriculture Committee’s competing version. Passage on the full Senate floor would necessitate 60 affirmative votes, requiring bipartisan cooperation with Democratic senators joining Republican supporters.

Senator Cynthia Lummis, among the bill’s most vocal proponents, announced Friday she will not pursue re-election and her tenure concludes in January 2027. “This is our last chance to pass the Clarity Act until at least 2030,” she wrote on X.

The Office of the Comptroller of the Currency recently granted approval for Coinbase’s national bank trust charter application, joining previously approved entities including Paxos, Ripple Labs, BitGo, Circle, and Fidelity Digital Assets.