Circle jumps 16% on Clarity Act compromise that preserves stablecoin rewards
Current reporting from Global indicates significant developments regarding Circle jumps 16% on Clarity Act compromise that preserves stablecoin rewards, as the situation continues to evolve with incoming data.
Shares of Circle surged after lawmakers over the weekend struck a compromise on the market structure bill known as the CLARITY Act, preserving stablecoin reward programs under certain conditions. On Friday, key language in the proposed crypto legislation was updated to restrict crypto companies from paying savings account-like interest or yield to users on passive stablecoin deposits – leaving that function to traditional banks. However, the bill does allow rewards as usage-driven incentives that could be tied to activity like trading, transactions or staking, as expected. The stablecoin issuer Circle jumped 16%, while Coinbase, the main distributor of Circle's USDC stablecoin, gained more than 7%. BitGo and Galaxy Digital rose 12% and 5%, respectively. Bitcoin was little changed at about $79,000, after the flagship cryptocurrency topped $80,000 over the weekend for the first time since January. Earning yield, usually in the form of rewards, on stablecoins like USDC and others has been a key incentive for users to hold the coins – similar to the interest earned on cash sitting in a bank account. The revised language is a relative win for Circle and Coinbase. However, it could pressure smaller crypto platforms that have leaned heavily on high-yield deposit products to attract users. The development also aligns with a wider industry shift away from return-seeking products and services and toward crypto's use in upgrading financial infrastructure. Most banks have yet to we
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