White House Reaches Tentative Crypto Regulatory Agreement Over Stablecoins

Key senators and the White House have reached a tentative agreement on cryptocurrency legislation aimed at resolving a dispute between banks and digital asset firms over stablecoin yields, according to Politico reporting.

“Advocates have been hoping for a May resolution of the years-long legislative effort”

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The move could clear the way for a landmark crypto regulatory bill stalled in the Senate Banking Committee since January.

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Sen. Angela Alsobrooks, D-Md., Sen. Thom Tillis, R.N.C., and the White House have reached that agreement, Alsobrooks' spokesperson Connor Lounsbury told The Block.

"This is an important step forward for market structure legislation, a step that both have worked for months to resolve," Lounsbury said.

The White House's Patrick Witt called the agreement in principle a "major milestone" in advancing the Digital Asset Market Clarity Act of 2025, also known as the CLARITY Act.

Senator Cynthia Lummis, R-Wyo., one of the biggest advocates for digital asset policy on the Hill, said at the DC Blockchain Summit, "We are so close" to passing a comprehensive crypto regulatory framework.

A spokesperson for Senator Lummis told Cointelegraph that a deal is expected to materialize in "the next few days."

The debate over how to handle stablecoin rewards has become a major point of contention for the Senate Banking Committee.

Banking industry advocates argue that permitting yields could siphon deposits away from traditional institutions, potentially harming community banks.

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Crypto companies contend that limiting these rewards would hinder innovation.

"Banks are fearful that the bill will erode market share and cause deposit flight," Cointelegraph reported, noting that banking industry opposes yield-bearing stablecoins, citing concerns over the flight of bank deposits.

Senator Tim Scott acknowledged the complexity, saying lawmakers expect a compromise on stablecoin yield rules soon and noted that a proposal could reach his office by the end of the week.

White House officials have been engaged in ongoing talks with lawmakers, with Patrick Witt calling banking concerns about stablecoin yield "overblown."

The disagreement has been a major obstacle in advancing the CLARITY Act, which was widely anticipated to pass after the GENIUS stablecoin framework was signed into law but stalled in January after major industry players, including crypto exchange Coinbase, voiced concerns.

The tentative agreement reportedly prohibits stablecoin yield on "passive balances," a compromise aimed at addressing banks' concerns while preserving some innovation for crypto firms.

“Key senators and the White House have reached a tentative agreement on cryptocurrency legislation aimed at resolving a dispute between banks and digital asset firms over stablecoin yields, according to Politico reporting”

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Senator Alsobrooks explained, "I think what it will do is to allow us to protect innovation, but also gives us the opportunity to prevent widespread deposit flight," adding that the deal prohibits stablecoin yield on "passive balances."

Senator Tillis, while optimistic, emphasized that the tentative pact is not final and that he still plans to review the details with industry stakeholders before moving forward.

One senator described the expected agreement in clear terms: "Everyone will be a little unhappy," reflecting the challenge of balancing competing interests.

According to Blockonomi, legislators have reportedly accessed a White House economic examining stablecoin yield and its influence on banking deposits, though the document remains unreleased to the public.

The discussions have reportedly transitioned from text finalization toward stakeholder engagement, with Senator Lummis indicating that stablecoin incentive programs that avoid terminology associated with savings accounts or interest accrual may remain in the final legislation.

Senate Banking Committee Republicans convened in Washington with Patrick Witt to address outstanding matters, particularly the regulatory treatment of stablecoin yield mechanisms.

Revised legislative language was anticipated to arrive at the White House, though negotiations remain active.

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Senator Lummis characterized the discussions as being in a "delicate state" while noting that the session revealed previously unexplored approaches.

Market expert MartyParty noted on X that Senator Cynthia Lummis has indicated the Senate Banking Committee plans to hold a markup in the second half of April, likely during the weeks beginning April 13 or April 20 after the Easter recess.

A planned CLARITY Act markup would expose the draft to changes and possible political maneuvering, but it would also be a crucial step toward floor consideration.

As of right now, it's unclear what more details will emerge from the current talks in Washington, D.C., but there's growing optimism that the legislation could advance in 2026.

The timing of this update is notable, coming as pressure builds to finalize crypto rules and market participants watch closely for any formal announcement.

Brian Armstrong, CEO of Coinbase, whose previous resistance contributed to blocking an earlier bill iteration, has demonstrated increased willingness toward compromise during recent discussions, according to Senator Lummis.

“Crypto Clarity Act inches toward Senate hearing as lawmakers weigh legislative trades The White House may be reviewing fresh legislative text, and lawmakers are reportedly weighing offers to banks of other, unrelated provisions for their support”

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Coinbase did not respond to a request for comment from Cointelegraph.

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In an interview with CNBC, Haun Ventures CEO Katie Haun voiced concerns about whether sweeping crypto legislation would have enough time, asking: "But to me, the big question on the Clarity Act is, is Congress going to get a bill to the floor on time to vote?"

The legislation aims to clarify how regulatory authority is divided between the Commodity Futures Trading Commission and the Securities and Exchange Commission, spell out when digital assets should be treated as securities versus commodities, and introduce new disclosure requirements.

Last year, the House approved its version of a crypto market structure bill with bipartisan backing, while the Senate Agriculture Committee passed its own version along party lines without any Democratic support.

Senate Republicans are exploring the possibility of incorporating community bank deregulation provisions into the crypto legislation as a strategic maneuver to strengthen its passage likelihood, connecting the CLARITY Act with housing reform measures.

The tentative agreement represents significant progress in the long-running effort to establish a comprehensive regulatory framework for cryptocurrencies in the United States.

The Digital Asset Market Clarity Act of 2025 is intended to create a clearer market-structure framework for cryptocurrencies, addressing regulatory gaps that have created uncertainty for both traditional finance and digital asset firms.

The bill complements ongoing Senate discussions on market structure legislation and follows the SEC and CFTC signing a memorandum of understanding that ended previous regulatory overlap concerns.

Historically, the SEC issued a framework on tokens in 2019 and previously issued a DAO report in 2017 that helped provide examples of tokens potentially qualifying as securities, though those documents lacked the comprehensive scope of today's Commission-level interpretation.

The interpretation further explains how a non-security crypto asset may become subject to an investment contract, providing clarity that the industry has sought for years.

As the negotiations continue, stakeholders remain cautiously optimistic about the potential for meaningful regulatory progress that could provide much-needed certainty to the rapidly evolving crypto market.