Tillis and Alsobrooks Strike Stablecoin Rewards Deal to Advance CLARITY Act

Sens. Thom Tillis and Angela Alsobrooks have finalized a compromise on stablecoin rewards ahead of a planned May markup of the CLARITY Act, setting guardrails that would bar interest-like payouts while permitting certain activity-based incentives under a strict compliance test. Punchbowl News reported the deal caps stablecoin-linked rewards that are "economically or functionally equivalent" to interest on bank deposits. The language still allows incentives tied to user or platform activity, but only if firms can satisfy an equivalence standard before offering them. The provision would apply to covered parties, including exchanges and affiliated entities that distribute rewards. The approach builds on the GENIUS Act, signed by President Donald Trump on July 18, 2025. That law prohibited interest payments by stablecoin issuers, but left less clarity around rewards offered in secondary markets. Under the compromise, regulators would be directed to develop an implementation framework, including compliance standards for the equivalence test, a new disclosure regime, and a defined list of permitted reward activities. The goal is to standardize how stablecoin reward programs are evaluated across platforms. The agreement removes a major hurdle that had slowed progress, though broader issues in the CLARITY Act remain unresolved. Senate Banking Committee Chairman Tim Scott has said unified Republican support is still needed ahead of markup. Industry reactions were swift. Blockchain Association CEO Summer Mersinger said the compromise clears a path to Senate markup and brings market-structure legislation closer to moving forward. Coinbase Chief Policy Officer Faryar Shirzad said the outcome preserves activity-based rewards and reflected negotiations involving the White House, the Treasury Department, and Senate staff. He added that banks won tighter limits while crypto firms retained user-based reward models, with additional work continuing on token classification, decentralized finance, and tokenization. Discussions between banks and crypto firms are also continuing on how stablecoins fit into the broader financial system.