Key senators and the White House have reached a tentative agreement on cryptocurrency legislation aimed at resolving a dispute between banks and digital asset companies over stablecoin dividends, according to Politico reporting.
The move could clear the way for a landmark crypto bill that has been stalled in the Senate Banking Committee since January.
Late. Thom Tillis (RN.C.) and Sen. Angela Alsobrooks (D-Md.) said Friday they have “agreement in principle” on language that must balance innovation with financial stability. The legislation seeks to prevent stablecoin reward programs from triggering widespread withdrawals of deposits from traditional banks, a concern raised by Wall Street groups.
“The agreement allows us to protect innovation while allowing us to prevent widespread capital flight,” Alsobrooks said. Tillis described the agreement as a positive step, but noted the need to consult with industry stakeholders before finalizing the details.
While the details of the agreement remain unclear, early indications suggest that it could prevent dividend payments on passive stablecoin balances. The tentative deal signals progress toward an April vote on the crypto market structure bill, potentially opening up the first major federal regulatory framework for digital assets.
Background of crypto legislation
The fight over a US crypto market structure bill stems from a broader effort to build on 2025’s landmark stablecoin legislation, the GENIUS Act, which established a federal framework for stablecoins — requiring full backing, transparency and disclosure of digital dollar reserves.
This law was widely seen in the crypto industry as a breakthrough for regulatory clarity while trying to align digital assets with traditional financial standards.
Following the passage of the GENIUS Act, the Senate turned its attention to more expansive oversight of digital assets through what is often referred to as the CLARITY Act or the Crypto Market Structure Bill.
This legislation aims to define how US regulators will monitor and oversee trading platforms, tokens, custody services and other infrastructure – essentially the backbone of a regulated digital asset ecosystem.
However, negotiations stalled over a central issue: whether regulated exchanges should be allowed to offer yield-bearing rewards on stablecoin holdings.
Banks and major financial institutions argue that these rewards are similar to unregulated deposit-style products that could siphon funds away from FDIC-insured accounts, potentially threatening lending and financial stability.
Crypto firms — including major issuers like Circle and Coinbase — counter that such incentives are essential to competitive markets and user adoption of digital money.
The current tentative agreement being negotiated between senators and the White House seeks a middle ground — potentially enabling activity-based rewards and limiting passive benefits — in hopes of unlocking Senate committee action by April. Whether this compromise holds both banking and crypto support will be crucial to the future of US regulation of digital assets.