CryptoSlate
The CLARITY Act, the centerpiece of US crypto market-structure legislation, has stalled in Congress as Wall Street and crypto-native firms split over whether issuers should be allowed to pay stablecoin rewards. Goldman Sachs has broken ranks with the rest of the banking lobby to back the rewards language, while Charles Hoskinson, the founder of Cardano, has aligned with Senator Elizabeth Warren in opposing it.
Why it matters
The bill needs Democratic votes to clear the Senate, and President Trump's personal crypto interests are now a direct liability for those lawmakers. Trump's DeFi project, World Liberty Financial, sits squarely in the regulatory gray zone CLARITY is meant to resolve, and any senator voting with the administration is voting for a bill that benefits the president's own company. The White House has framed CLARITY as proof it delivered for crypto, but the politics on the Democratic side are inverted: backing the bill is now backing Trump.
Market impact
The stablecoin-rewards fight is a proxy war for control of the market's biggest pending US policy win. Banks fear reward programs pull deposits out of the traditional system; the crypto industry sees them as the core use case for stablecoins. CLARITY was supposed to settle that fight, but until the Trump conflict-of-interest question is neutralized, the math of cloture in the Senate does not work.
Frequently asked questions
-
What is the CLARITY Act and why does it matter for crypto?
The CLARITY Act is the centerpiece US crypto market-structure bill, designed to define which regulator oversees digital assets and resolve the gray zones around stablecoins and DeFi. Its passage would give US crypto firms a clear compliance path and unlock institutional capital that has been waiting on regulatory…
-
Why are Trump's crypto interests blocking the bill?
Trump's DeFi project, World Liberty Financial, sits in the regulatory gray zone CLARITY is meant to resolve. Democratic senators cannot vote for a bill that enriches the president's own company without inviting ethics and conflict-of-interest attacks.
-
What is the stablecoin-rewards fight within CLARITY about?
Banks argue that paying yield on stablecoins pulls deposits out of the traditional financial system. The crypto industry argues rewards are the core use case for stablecoins and that banning them effectively bans the product. CLARITY was meant to settle the question but now contains it as an unresolved flashpoint.
-
Why did Goldman Sachs break with other banks on rewards?
Goldman has deeper exposure to digital-asset trading infrastructure than most peer banks and stands to benefit from a more permissive rewards regime. The break exposes how unevenly Wall Street is positioned for the stablecoin transition.
-
What happens to CLARITY if the conflict-of-interest question is not resolved?
Without a credible firewall around Trump's crypto holdings, the bill cannot attract the Democratic votes needed for Senate cloture. The most likely outcomes are a narrower bill that excludes the conflict zone, a delay into the next Congress, or a carve-out that explicitly exempts presidential family projects.
Crypto News
CoinTelegraph
Crypto Rank News
TheBlock
CoinDesk