Banks try to kill the CLARITY Act
By Peace Longe from Crypto.news
The US banking lobby is mounting a last-minute push to stall the CLARITY Act just days before its scheduled Senate Banking Committee markup on May 14.
Five major banking groups jointly rejected the Tillis-Alsobrooks stablecoin yield compromise, calling it insufficient days before the May 14 markup.
Senators Cynthia Lummis and Thom Tillis publicly defended the deal, warning that banking opposition may be aimed at killing the CLARITY Act altogether.
Prediction markets currently price the bill’s odds of becoming law in 2026 at over 60%, with the White House targeting a July 4 presidential signature.
The American Bankers Association, the Bank Policy Institute, the Consumer Bankers Association, the Financial Services Forum, and the Independent Community Bankers of America issued a joint statement this week rejecting the compromise stablecoin yield language drafted by Senators Thom Tillis and Angela Alsobrooks.
The coalition said the proposed language falls short of its policy goals and leaves dangerous loopholes that could trigger deposit flight from traditional banks.
The banking groups argue that Section 404 of the CLARITY Act still permits crypto platforms to offer rewards tied to account balances and how long users hold assets, which they say amounts to offering deposit interest under a different name.
The coalition added that it is “imperative that Congress get this right.”
Lummis and Tillis push back
The response from the bill’s sponsors was immediate.
Senator Cynthia Lummis posted on X that the finalized bipartisan text “is the culmination of months of hard work to deliver a compromise on yield we can all live with.”
Senator Tillis warned that some factions within traditional finance may oppose any version of the CLARITY Act and are using the stablecoin yield debate to stall the legislation.
Tillis said: “Some in the banking industry may not want either of these things to happen, and we respectfully agree to disagree.”
What comes next
Senate Banking Committee Chairman Tim Scott confirmed the markup hearing for May 14 at 10:30 am.
The White House has set a July 4 target for passage, with crypto adviser Patrick Witt describing the stablecoin yield deal as closed.
Ripple CEO Brad Garlinghouse said at Consensus Miami 2026 this week that the past week represented a “big positive shift” in Senate momentum.
A HarrisX poll released this week found that 52% of registered US voters support the CLARITY Act.
For the bill to reach the president’s desk, it must clear the Senate Banking Committee markup, survive a 60-vote floor threshold, be reconciled with the Senate Agriculture Committee version, and then reconciled with the House-passed text.
Source : https://crypto.news/banks-try-to-kill-the-clarity-act/
