US Senate stablecoin yield resolution

What happened: The U.S. Senate resolved the stablecoin yield issue, with the Senate Banking Committee set to vote on a major crypto bill on May 14. This bill, part of the CLARITY Act, restricts yield-like rewards on stablecoin balances, a compromise that has been backed by Coinbase and Circle. The new language bars stablecoin issuers like Circle from paying yield on reserves, while preserving some aspects of stablecoin rewards.

Market impact: Crypto-related stocks rallied, with Circle (CRCL) and Coinbase (COIN) shares climbing 15% and 5% respectively, as investors digested the long-awaited stablecoin yield text. However, U.S. banks remain dissatisfied, arguing that the new language fails to protect bank deposits.

What to watch next: The Senate Banking Committee's vote on the crypto bill on May 14 will be a key catalyst. Additionally, the industry awaits further feedback from banking groups on the revised stablecoin proposal, and potential changes to the bill before it reaches the Senate floor.