Bitcoin holds as White House weighs CLARITY Act yield rules

TLDR

• White House talks narrowed gaps; stablecoin yield remains unresolved sticking point.
• Constructive tone reported; market-structure issues progressed without final accord.
• Treasury urges spring passage of CLARITY Act to boost market confidence.

The latest CLARITY Act White House meeting brought bank representatives and crypto policy leaders closer on several market-structure issues, but the stablecoin yield provision remains the main obstacle. Participants characterized the tone as constructive, and the scope of disagreement appears narrower than in prior sessions.

As reported by CoinDesk, the talks advanced key elements while stopping short of a final accord, and additional discussions are expected. Treasury Secretary Scott Bessent has urged lawmakers to move the bill by spring to bolster market confidence, according to Coingape.

Why stablecoin yield is the sticking point for the CLARITY Act

At issue is whether stablecoin holders may receive yield, interest-like rewards funded by issuers or third parties, on custodial balances. Proponents argue narrowly tailored rewards could coexist with robust consumer protections, while opponents warn that permissive rules may create systemic risks.

Banks cite the potential for “deposit flight,” where yield-bearing stablecoins could siphon funds from insured bank deposits and impair lending capacity, according to the American Bankers Association. Crypto stakeholders counter that an outright prohibition would needlessly chill innovation and that targeted guardrails could manage risk.

Policy officials have framed the problem as narrow but consequential, signaling a preference for precision over blanket bans. “Constructive, fact-based, and, most importantly, solutions-oriented,” said Patrick Witt, Executive Director of the White House Crypto Council, as reported by Ledger Insights.

Banks vs. crypto: positions on stablecoin yield and deposit flight

Banks have pressed for a total ban on yield, whether paid directly by issuers or via third parties, arguing that even limited programs could accelerate outflows from community and regional institutions. Industry groups on the crypto side have indicated openness to compromise calibrated to disclosures, prudential standards, and clear risk segregation.

According to CoinCentral, bank delegations presented a principles document seeking to prohibit yield features outright, while several crypto representatives signaled that carefully scoped alternatives might bridge the gap; the report also noted Ripple’s general counsel Stuart Alderoty expressed cautious optimism about a landing zone. With government facilitators urging a scalpel rather than a chainsaw, participants appear to be exploring targeted solutions instead of categorical prohibitions.

At the time of this writing, Coinbase shares closed at $165.94, up 1.15% on the day, based on data from Yahoo Finance. Bitcoin recently traded near $67,133, providing a volatile backdrop as negotiations continue.