Coinbase CLO Says Clarity Act Is Near Agreement on Stablecoin Earnings

Coinbase Chief Legal Officer Paul Grewal has reportedly signaled that negotiations over the CLARITY Act are nearing agreement on the contentious issue of stablecoin earnings, according to unconfirmed reports. The remark, if accurate, would mark a significant moment in the months-long legislative push to define whether and how crypto firms can offer rewards tied to stablecoins under federal law.

The claim that Grewal described the CLARITY Act as “very close” to an agreement on stablecoin earnings has not been confirmed by a direct transcript or verified English-language source. However, the broader trajectory of negotiations over stablecoin rewards is well documented, and multiple verified developments suggest the gap between lawmakers, crypto firms, and banks has been narrowing since early 2026.

Coinbase CLO Signals Clarity Act Talks Are Near a Breakthrough

Grewal appeared on Fox Business in early February 2026, where host Maria Bartiromo asked about CLARITY Act progress and the implications of the GENIUS Act. A Fox program summary from February 3, 2026 described Grewal as confident that follow-on legislation would add federal spot-market oversight and protect decentralized finance.

In that appearance, Grewal described the GENIUS Act as current law that allows stablecoin rewards within a framework requiring 100% reserve backing for payment stablecoins. His framing positioned Coinbase as a company operating within existing legal guardrails while advocating for further legislative clarity.

The specific claim that Grewal used the phrase “very close” regarding a stablecoin-earnings compromise originated from a single unconfirmed source. No fetched transcript or direct English-language quote has verified that exact wording, so the attribution should be treated with caution.

Why Stablecoin Earnings Have Become a Key Negotiation Point

Stablecoin earnings refer to rewards or yield that platforms like Coinbase offer users who hold or transact with stablecoins. The distinction between passive yield, where users earn simply by holding a stablecoin, and activity-based rewards, where incentives are tied to transactions or network participation, has become the central fault line in negotiations.

The GENIUS Act, now Public Law 119-27, explicitly prohibits payment stablecoin issuers from paying “any form of interest or yield solely in connection with holding, using, or retaining a payment stablecoin.” That statutory language effectively bans passive yield from issuers.

The debate has therefore shifted to a narrower question: whether exchanges and other crypto firms, as opposed to issuers, can still offer activity-based rewards. White House Crypto Council Executive Director Patrick Witt said in late February 2026 that the gap over stablecoin rewards had “shrunk considerably” after talks between crypto and banking representatives.

The same reporting indicated that yield on idle stablecoin balances was effectively off the table, with the debate narrowing to activity-based rewards such as transaction-linked or network-linked incentives. This distinction matters because it determines whether platforms can compete with traditional savings products.

Stablecoin infrastructure has faced broader scrutiny beyond just the earnings question. Concerns raised by ZachXBT about Circle’s handling of the Drift hack and a Solana CCTP leak have highlighted that operational risks persist alongside regulatory ones. Meanwhile, the Drift Protocol attack that cut TVL in half underscored the fragility of DeFi platforms interacting with stablecoin ecosystems.

What a Near-Term Agreement Could Mean for Coinbase and the Crypto Sector

H.R.3633, the Digital Asset Market Clarity Act of 2025, passed the House on July 17, 2025 by a 294-134 vote. The bill was referred to the Senate Banking Committee on September 18, 2025, where it has remained as negotiations over stablecoin provisions continue.

294-134

The bipartisan House margin, with nearly a two-thirds majority, gave the bill strong momentum heading into the Senate. Coin Center’s Peter Van Valkenburgh has publicly supported the bill’s advancement.

For Coinbase specifically, a resolution that preserves activity-based stablecoin rewards would protect a growing revenue stream. The exchange has positioned itself as a compliant platform operating within the GENIUS Act’s framework, and Grewal’s public statements have consistently argued that current law already permits stablecoin rewards.

A clear federal framework would also reduce legal uncertainty for competing exchanges and fintech firms that have been cautious about launching stablecoin reward products. The 2% capital haircut reported in the negotiations, under which 98% of stablecoin holdings would count toward broker-dealer capital requirements, could further incentivize traditional financial firms to enter the space.

As of late March 2026, Senators Thom Tillis and Angela Alsobrooks had reportedly reached an agreement in principle with the White House under which passive yield would remain banned while activity-based rewards would likely be allowed. No final legislative text has been published.

For the crypto industry overall, passage of a comprehensive market-structure bill would represent the second major federal crypto law after the GENIUS Act. Even firms focused on exchange infrastructure, such as Galaxy Digital, which recently weathered a testnet hack, stand to benefit from clearer regulatory boundaries for digital asset platforms.

What Still Needs to Happen Before the Issue Is Fully Resolved

The phrase “very close,” even if accurately attributed to Grewal, does not mean a deal is done. Several concrete steps remain before stablecoin-earnings rules become law.

First, the reported agreement in principle between Senators Tillis, Alsobrooks, and the White House must be translated into actual legislative text. Compromises reached in private negotiations can shift when exposed to full committee markup and floor debate.

Second, the CLARITY Act must clear the Senate Banking Committee and pass a full Senate vote. Even with bipartisan support, procedural hurdles and competing legislative priorities could delay action.

Third, any Senate amendments would need to be reconciled with the House-passed version before reaching the President’s desk. The strong House margin suggests the lower chamber is unlikely to block a reasonable Senate version, but conference negotiations add another layer of uncertainty.

Finally, implementation timelines matter. Even after passage, rulemaking by the SEC or other agencies could take months before platforms have clear operational guidance on what types of stablecoin rewards are permissible.

FAQ

What is the Clarity Act?

In this context, the CLARITY Act refers to H.R.3633, the Digital Asset Market Clarity Act of 2025. It is a market-structure bill that passed the U.S. House of Representatives and is currently pending in the Senate Banking Committee. The bill aims to define how digital assets are regulated and traded at the federal level.

Why does Coinbase’s chief legal officer’s comment matter?

Paul Grewal is the top legal voice at one of the largest U.S. crypto exchanges. Coinbase has a direct commercial interest in how stablecoin rewards are regulated, so signals from its CLO about the pace of negotiations are closely watched by the industry and policymakers.

Does “very close” to agreement mean the rules are final?

No. An agreement in principle between negotiating parties still must be drafted into legislative text, pass committee, clear a full Senate vote, be reconciled with the House version, and be signed into law. Each step introduces the possibility of changes or delays.

What is the difference between passive yield and activity-based rewards?

Passive yield is earned simply by holding a stablecoin, similar to a savings account interest rate. Activity-based rewards are tied to specific actions such as completing transactions or participating in network activity. Current law under the GENIUS Act bans issuer-paid passive yield, while the ongoing negotiations center on whether exchanges can offer activity-based incentives.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.