Patrick Witt, digital asset advisor to the US Presidency, stated that efforts are continuing on a compromise to advance the Digital Asset Market Openness Act (Clarity Act) in the Senate. The main goal of this law is to clarify the legal framework of the digital asset market in the USA.
Reconciliation step on stablecoin yield
It was stated that in the talks conducted by Patrick Witt and involving Republican and Democratic senators, common ground was reached on the stablecoin yield issue. In particular, the banking sector was concerned that giving interest similar to deposits in banks to investors holding stablecoins would negatively affect their deposit base.
While the bill was intended to be put to vote in the Senate Banking Committee at the beginning of the year, the process was suspended due to bankers’ objections to the stablecoin yield. However, with the recent negotiations, it was reported that the parties reached an agreement on the stablecoin yield.
Patrick Witt stated that they hope the compromise reached will be permanent. According to his statement, after the stablecoin preparations were completed, other controversial topics were focused on and serious progress was made in a few of them.
Clarity Act and other topics on the agenda
Apart from the stablecoin return, the Clarity Act bill also includes protection measures regarding illegal financial transactions, especially in the field of decentralized finance (DeFi), and the demands of some Democratic senators to prevent senior government officials from earning income through the crypto sector.
Although Witt did not explain which topics were finalized in the ongoing negotiations, he emphasized that significant progress was made in the background, apart from the intense debate on the stablecoin. He stated that they have reached the final stages and that many points that were initially considered unresolvable are nearing completion.
Finally, the Clarity Act must pass formal hearing in the Senate Banking Committee. If the necessary process for the law to come into effect is completed, it can be moved to the final Senate vote.
Last week, White House economic advisors published a report stating that stablecoins’ deposit-like returns do not put the banking sector at risk. However, the American Bankers Association stated that it did not agree with this view and argued that there were errors in the President’s approach.
Patrick Witt stated that bank representatives’ relationships with new technologies have an impact on their views on this issue, that those in closer contact can approach stablecoins more positively, while some see them as a threat.
Patrick Witt noted that “all these issues once seemed unsolvable, and pointed out that the progress achieved so far can overcome the remaining problems.”
It is reported that in order for the prepared law to progress, an agreement has been reached on a significant part of the topics that caused great conflict between banks and the crypto industry.
It is considered that the decisions to be taken in the Senate will be guiding in terms of digital asset market and #stablecoin regulations.
