Coinbase Threatens to Withdraw Support for CLARITY Act Over Stablecoin Rewards Ban
Written by Ohris M. Greyoon, Blockchain & Crypto Expert
Source: Coinmarketcap
Updated: Jan 12 2026- Legislative Support Crisis: Coinbase threatens to withdraw support for the CLARITY Act due to a proposed ban on stablecoin rewards, which could significantly increase uncertainty in U.S. digital asset regulation and impact the legislative process.
- Revenue Model Impact: Stablecoin rewards, generated through Coinbase's partnership with Circle, are crucial for its revenue; banning these rewards would directly affect Coinbase's income model, potentially leading to user attrition and weakening its market competitiveness.
- Significant Political Influence: Coinbase contributed approximately $3.2 million during the 2023-2024 election cycle, making it a leading political donor in the crypto industry, and its opposition could sway undecided lawmakers, altering the bill's trajectory.
- Market Dynamics Shift: If stablecoin rewards are banned, around 35% of U.S. cryptocurrency investors will be affected, potentially leading users to migrate to other platforms or investment vehicles, thereby reshaping the competitive landscape of cryptocurrency exchanges.
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.
