Senate unveils updated market structure bill limiting stablecoin rewards on idle holdings

U.S. senators released a new bipartisan draft of a market structure bill that draws a sharp line on stablecoin rewards, prohibiting digital asset service providers from paying interest or yield for users merely holding payment stablecoins. However, the legislation allows exceptions for incentives linked to specific actions like transactions, staking, or providing liquidity. This language reflects a compromise floated by Senator Angela Alsobrooks to resolve tension between banking groups, who fear liquidity risks from idle yield, and crypto firms, who accuse banks of stifling competition. The draft also incorporates a measure from Senators Lummis and Wyden to shield crypto software developers from intermediary liability. The bill is advancing toward a Banking Committee markup, though it does not address ethics concerns related to President Trump's family crypto ventures.

(Source：The Block)