What the CLARITY Act does
H.R. 3633, the Digital Asset Market Clarity Act, would create the first federal rulebook for crypto markets. Where the GENIUS Act covers the companies that issue stablecoins, CLARITY covers the rest of the market: tokens, exchanges, brokers and the platforms that distribute stablecoins.
- Most digital assets would be treated as digital commodities and regulated by the CFTC. The SEC would keep authority over digital securities.
- Network tokens sold as part of an investment contract would be classed as "ancillary assets" with an exemption from SEC registration, plus a limited fundraising exemption for issuers ("Regulation Crypto").
- Digital commodity exchanges and brokers would register with the CFTC and meet custody and disclosure standards.
- Rules for DeFi, law enforcement and illicit finance.
- Limits on rewards paid on stablecoin balances (Section 404, below).
The stablecoin yield compromise
Stablecoin rewards were the biggest fight. Banks argued that interest-like payments on stablecoins would pull deposits away from lending; Coinbase and other platforms argued that banning rewards would be anticompetitive. The GENIUS Act already bars issuers from paying interest, so the question was whether exchanges and other platforms could.
The compromise from Senators Thom Tillis and Angela Alsobrooks, released on May 1, 2026, bans paying interest or yield to holders either solely for holding a payment stablecoin, or in a way that is economically equivalent to interest on a bank deposit. It keeps room for rewards based on genuine activity: payments, transfers, staking, providing liquidity, governance, or loyalty programs. Regulators would have to publish a list of permitted rewards and disclosure rules.
In practice, that is the line that products like PayPal'sPYUSD rewards or exchange USDC rewards would be measured against if the bill becomes law. For what pays yield today, see our guide tostablecoin yield, and how the OCC treats platform rewards instablecoin rewards vs yield.
Why it stalled
On September 15, 2026, all voting Democrats, Republicans Collins, Hawley, Moran and Tillis, and independents King and Sanders voted against cloture. Senator Coons did not vote. Beyond yield, the open issues were an ethics provision restricting officials and their families from profiting from crypto, a sensitive point given the president's family's crypto ventures such as World Liberty Financial and its USD1stablecoin, and law enforcement provisions.
Tillis voted no to preserve a motion to reconsider, which lets leadership bring the bill back without restarting the process.
What happens next
- The Senate returns on November 6, 2026, three days after the midterms. The lame-duck session runs until the holiday break.
- Passing would take 60 Senate votes, merging the Banking and Agriculture texts, and a new House vote, since the Senate version replaces the House bill.
- If the bill is not enacted by January 3, 2027, it dies and must be reintroduced in the next Congress, whose makeup the midterms will decide.
- Meanwhile, the SEC and CFTC are working on their own rules. The CFTC requested comment on a retail crypto framework on October 5, 2026.
- Separately, Senators Daines, Lummis, Moreno and Tim Scott introduced the ADAPT Act on October 22, 2026, a tax bill that would ease reporting on small stablecoin payments and network fees of $10 or less.
None of this changes anything in your accounts today. The rule that does take effect soon is the GENIUS Act's stablecoin issuer regime, on January 18, 2027. Read our GENIUS Act explainer.
