Key Points
- May 14 markup hearing scheduled for the Digital Asset Market Clarity Act by Senate Banking Committee
- Legislation faced delays after Coinbase withdrew support in January over stablecoin rewards and DeFi oversight
- Bipartisan stablecoin yield agreement reached by Senators Tillis and Alsobrooks restores momentum
- Traditional banking organizations express reservations and request additional revisions
- Senator Gillibrand pushes for ethics rules preventing government officials from crypto conflicts of interest
The Senate Banking Committee has announced May 14 for its markup session on the Digital Asset Market Clarity Act of 2025, commonly referred to as the Clarity Act. The proceedings are scheduled to commence at 10:30 a.m.
This represents a critical milestone in the legislative journey. During a markup session, committee members examine and cast votes on proposed legislation prior to sending it to the complete Senate for consideration.
The legislation has encountered significant obstacles in recent months. Back in January, Brian Armstrong, CEO of [[LINK_START_0]]Coinbase[[LINK_END_0]], declared the platform would withdraw its endorsement. Armstrong cited multiple issues including insufficient legal safeguards for developers working on open source projects, restrictions on stablecoin rewards programs, and concerns about decentralized finance regulations.
This withdrawal created a standstill that lasted several months.
Senators Thom Tillis and Angela Alsobrooks unveiled a bipartisan compromise last week addressing the contentious stablecoin yield question. Under the proposed framework, digital asset platforms would be prohibited from offering returns on passive stablecoin reserves, while permitting rewards when stablecoins participate in active financial transactions.
The announcement drew positive reactions from Coinbase. Paul Grewal, the company’s chief legal officer, shared on X: “It’s on like Donkey Kong.” Faryar Shirzad, chief policy officer, characterized it as a “big step forward” and emphasized the legislation’s importance for consumer protection and maintaining American leadership in digital asset innovation.
Senator Cynthia Lummis, known for her cryptocurrency advocacy, expressed support for the development, declaring on X: “Let’s pass the Clarity Act out of the Banking Committee on Thursday!”
Traditional Banking Sector Voices Reservations
Universal support remains elusive. Multiple banking industry organizations — including the American Bankers Association, the Bank Policy Institute, and the Independent Community Bankers of America — jointly authored a letter stating “additional work is needed” on the bill’s wording. These groups submitted detailed revision requests to the compromise language unveiled last week.
Nevertheless, the decision to schedule the markup indicates Senate leadership intends to proceed with the existing draft.
Ethics Requirements Still Under Discussion
Senator Kirsten Gillibrand, who has consistently championed cryptocurrency legislation, has introduced an additional concern. She advocates for including ethics language that would prevent high-ranking government officials from financially benefiting from the crypto sector while simultaneously overseeing its regulation.
Research commissioned by CoinDesk revealed that 73% of registered American voters favor such restrictions.
Nevertheless, this ethics component may not appear in the Senate Banking Committee’s draft. Following the Banking Committee’s markup, the [[LINK_START_1]]Senate[[LINK_END_1]] must reconcile its version with the Senate Agriculture Committee’s version before the complete Senate can hold a final vote.
Kara Calvert, Coinbase’s vice president of US policy, had anticipated the markup timing during remarks at the Consensus 2026 conference earlier this week. She also highlighted that the legislation will require a minimum of 60 votes and cross-party cooperation to become law.
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