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A new US Senate draft bill would permit crypto companies to offer activity-based rewards to stablecoin users, marking a significant development in the ongoing debate between digital asset firms and traditional banking groups over yield-bearing products.
The proposal, titled the Digital Asset Market Clarity Act, clarifies that certain rewards and incentives tied to stablecoin use would be permitted. The provision notes that offering such rewards does not cause a stablecoin to be treated as a security or a bank-like product.
Senate Banking Chair Tim Scott
Senate Banking Chair Tim Scott, who released the amended draft, said in a statement shared with Cointelegraph:
"Families and small businesses benefit from clear rules of the road. This bill reflects months of serious work, ideas, and concerns that have been raised across the Committee, and it gives everyday Americans the protections and certainty they deserve."
— Tim Scott, Senate Banking Chair
Stablecoin rewards have become a major point of contention between crypto companies and banking groups. Banking groups have argued that yield-bearing stablecoin products resemble deposit-taking or unregulated investment vehicles. Crypto companies contend that such programmes function more like loyalty points or payment incentives common in fintech.
Under the draft, the prohibition would not apply to incentives connected to everyday financial activity. These include rewards linked to payments, transfers, remittances and settlements, as well as benefits tied to the use of wallets, accounts, platforms or blockchain networks. Loyalty and promotional programmes, subscription-based incentives, and rebates related to the use of stablecoins are also covered.
The exemption extends further into crypto-native activity. According to the text, rewards associated with providing liquidity or collateral, as well as participation in governance, validation, staking or broader ecosystem activity, would be permitted.
The draft clarified that a digital asset service provider "may not pay any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding of a payment stablecoin."
The US Senate Agriculture Committee has delayed its markup of the crypto market structure bill until the final week of January, with Chairman John Boozman citing the need for more time to secure broad bipartisan support.
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