Coinbase is intensifying its lobbying efforts toward U.S. senators in anticipation of an upcoming markup session of the Senate Banking Committee. This push hints at a potential shift in the company’s stance concerning the CLARITY Act for Digital Tokens, particularly if the bill imposes prohibitions or stringent constraints on stablecoin rewards available through crypto exchanges.
Reports from Bloomberg and other industry sources indicate that internal discussions at Coinbase reveal concerns about the implications of the proposed legislation. A source familiar with the exchange’s perspective suggested that Coinbase “may reconsider its support” if the bill restricts stablecoin issuers from offering rewards on exchange platforms and similar venues. Currently, no official statement has been issued by Coinbase, and inquiries made by Cointelegraph for further clarification have gone unanswered.
The CLARITY Act seeks to delineate the laws governing digital asset markets, encompassing regulations related to stablecoins and decentralized finance (DeFi). It is intended to build upon the foundational aspects of the GENIUS Act, which became law in July 2025. While the GENIUS Act laid out essential legal guidelines for dollar-pegged stablecoins, it notably did not authorize issuers to directly offer interest or yield to token holders. However, it did permit rewards through third-party platforms, a loophole that banking advocates are eager to close with the new legislation.
The core of the current debate revolves around stablecoin rewards, which have proven to be a significant revenue stream for Coinbase. The exchange reported approximately $247 million in stablecoin-generated income in the last quarter, along with $154.8 million from blockchain rewards. Products like Circle’s USDC allow users to earn yields of up to 3.5% when held on compliant platforms, thereby enhancing user engagement and retention on the platform.
Concern arises from banking associations, particularly the Bank Policy Institute, which argues that such rewards could siphon trillions of dollars in deposits from traditional banking institutions. The U.S. Treasury Department has also expressed apprehension, suggesting that widespread adoption of stablecoins might extract as much as $6.6 trillion from the conventional banking ecosystem. Detractors argue that this trend could undermine smaller financial institutions and pose risks to overall economic stability. Conversely, Coinbase contends that imposing limits beyond basic disclosure requirements could stifle competition, hinder innovation, and restrict consumer choice.
As part of its broader strategy, Coinbase has been pursuing a national trust banking charter, aiming to establish a framework that allows it to offer rewards in compliance with regulatory standards. The situation has galvanized the crypto advocacy community, with organizations like Stand With Crypto reporting that their supporters have sent over 135,000 emails to senators urging the protection of stablecoin rewards. In contrast, an anti-DeFi group has initiated advertising campaigns urging the prohibition of specific DeFi functionalities.
Chairing the Senate Banking Committee, Tim Scott has expressed optimism about the swift progression of the bill, claiming it could “deliver real results for the American people.” However, analysts warn that factors such as the midterm elections and existing party divisions could complicate the legislative process, with projections indicating that definitive adoption may not occur until as late as 2029.
As the markup date nears, the debate surrounding stablecoin rewards is shaping up to be a critical flashpoint. Should Coinbase adjust its support, it could fracture the bipartisan backing for the bill, potentially delaying significant regulatory changes in the crypto landscape. As this vital policy discussion unfolds, industry stakeholders remain vigilant, assessing the balance between fostering innovation and addressing banking sector challenges.
