No one is 100% happy with the stablecoin yield agreement: State of Crypto

Industry representatives saw the crypto market structure bills proposed yield language on March 23 and 24. The internet — at least X (formerly Twitter) — was unhappy, but it may not matter much.

The narrative

We* have new language outlining how the crypto market structure bill could address stablecoin yield.

*Only some people have seen the language, though it should be released for public consumption and review next.

Why it matters

Senator Cynthia Lummis (R-Wyo.) said earlier this month that she expected a market structure bill markup — the hearing where lawmakers debate amendments and language before voting on a bill — in the second half of April. Lawmakers have taken the first step toward that markup with an agreement on crypto market structure legislation.

Breaking it down

Crypto and banking industry representatives saw the proposed “agreement-in-principle” announced last week by Senators Angela Alsobrooks (D-Md.) and Thom Tillis (R-N.C.) at the start of this past week, with crypto representatives meeting with legislative staffers on Monday and banking representatives meeting with staffers on Tuesday.

No one appears to be particularly happy with the agreement. The language has not yet been released publicly, though it should come out this upcoming week. Concerns range from the possibility that the proposed language will call for regulators to draft new rules around permissible activity to how it might restrict stablecoin yield balances.

Its unlikely that the language will see major revisions, though one person familiar said they expected there could be some minor changes. Many of the necessary changes are just technical tweaks, they said.

Still, industry interests appear headed toward presenting some sort of counterproposal on the language. It remains to be seen how far that goes.

This week

• Congress is expected to be on its two-week Easter recess, though the ongoing fight over funding the Department of Homeland Security might change things.