Coinbase Threatens to Withdraw Support for CLARITY Act Over Stablecoin Reward Restrictions
Written by Ohris M. Greyoon, Blockchain & Crypto Expert
Source: Coinmarketcap
Updated: Jan 12 2026- Legislative Support Threat: Coinbase Global Inc. has indicated that it may withdraw its support for the CLARITY Act if it includes restrictions on stablecoin rewards, which could significantly impact its revenue from USDC reserves and threaten the company's financial stability.
- Market Stability Risks: Potential legislative changes restricting stablecoin rewards may diminish user incentives for holding USDC, thereby affecting liquidity and user engagement, which could lead to increased volatility in the crypto market.
- Traditional Bank Advantages: Restrictions on stablecoin rewards could favor traditional financial institutions in the competitive landscape, intensifying regulatory pressures on non-bank crypto platforms and impacting their market positions.
- Innovation Warning: Coinbase co-founder and CEO Brian Armstrong warns that broad bans on interest or yield for cryptocurrencies could harm innovation, advocating for clear regulations in crypto-related policies.
About the author
Ohris M. Greyoon
Ohris M. Greyoon holds a Master’s in Computer Science from MIT and has 10 years of experience in blockchain technology and cryptocurrency markets. A pioneer in decentralized finance (DeFi) analysis, he leads Intellectia’s Crypto News, offering cutting-edge insights into digital assets.
