Stablecoin Yield Ban Emerges in New CLARITY Act Draft

• Draft bans stablecoin yield and interest-like features, blocking direct and indirect reward structures across platforms.

• Allowed rewards include activity-based incentives, but must not depend on balances or resemble interest mechanisms.

• SEC, CFTC, and Treasury will define rules and anti-evasion measures, shaping future stablecoin reward frameworks.

New legislative language tied to the Digital Asset Market Clarity Act surfaced on March 23, 2026, outlining fresh restrictions on stablecoin yields and rewards. According to journalist Eleanor Terrett, industry leaders reviewed the draft the same day. The proposal aims to limit interest-like features on stablecoins while defining acceptable reward structures.

Yield Restrictions and Core Provisions

According to Eleanor Terrett, the draft would prohibit platforms from offering yield on stablecoins, both directly and indirectly. This includes any structure that resembles a bank deposit or functions like interest. The restriction applies broadly to digital asset service providers, including exchanges and brokers.

Additionally, the language bars any mechanism considered “economically or functionally equivalent” to interest. This provision aims to prevent firms from bypassing the rule through alternative structures. As a result, platforms may face tighter controls on how they design financial products tied to stablecoins.

Permitted Rewards and Regulatory Oversight

However, the proposal allows certain activity-based rewards linked to user behavior. These include loyalty programs, promotions, and subscription-based incentives. Still, such rewards must not resemble interest or depend on balances or transaction amounts.

Furthermore, the draft directs the Securities and Exchange Commission, Commodity Futures Trading Commission, and the U.S. Treasury to define permissible rewards. These agencies must also establish anti-evasion rules within one year. This step introduces a coordinated regulatory framework for stablecoin-related incentives.

Industry Reaction and Legislative Context

Industry responses to the draft remain mixed. One leader described the proposal as a departure from earlier discussions with the White House. They noted that the “economic equivalence” standard may allow stricter interpretations by future regulators.

Another reviewer called the approach more restrictive overall, citing limits on reward structures. However, a separate industry participant said the draft aligns with expectations. They added that it preserves transaction-based incentives while preventing stablecoins from acting like interest-bearing accounts.

Meanwhile, the proposal expands beyond the earlier framework introduced by Senators Thom Tillis and Angela Alsobrooks. Bank representatives are now set to review the draft, with further discussions expected ahead of the next legislative steps.