Coinbase Flags Risk Over Stablecoin Rewards in U.S. Crypto Bill

A major U.S. crypto market structure bill, known as the CLARITY Act, is heading into a critical Senate Banking Committee markup session this week. At the center of the debate is whether stablecoin issuers should be barred from offering rewards through crypto exchanges and other platforms. According to reports, Coinbase is signaling that it may withdraw support for the bill if lawmakers move to shut down stablecoin reward programs.

Sources familiar with the matter suggest Coinbase sees the proposed restrictions as a direct threat to both user choice and its own business model. While the company has not officially commented, the message to lawmakers appears clear: banning rewards could undermine innovation and participation in the U.S. crypto market.

Why Stablecoin Rewards Matter

Stablecoin rewards have become a major feature of crypto platforms, allowing users to earn returns on assets like USDC without traditional banking products. For exchanges such as Coinbase, these rewards are not a side business. In the fourth quarter alone, stablecoins generated nearly $247 million in revenue, while blockchain rewards added another $154.8 million.

Eliminating yield options on stablecoins offering around 3.5% returns could significantly reduce platform revenue and weaken incentives for users to hold and transact in regulated digital dollars.

The Reddit community reaction leans strongly against banks and in favor of keeping stablecoin rewards. Commenters largely mocked traditional banks, arguing they are afraid of competition and don’t want to raise deposit interest rates beyond near-zero levels. Some used sharp analogies, comparing banks opposing crypto yields to outdated industries resisting innovation. 

Others criticized how banks position themselves as “safe” while using crypto’s bad actors to justify restrictive rules. A few voices expressed frustration that scams have damaged the crypto sector’s image, providing banks with ammunition in policy debates, while Bitcoin-only supporters dismissed the broader sector altogether. 

Overall, the sentiment reflects deep skepticism toward banking lobbying efforts and broad support for preserving stablecoin rewards as a consumer-friendly alternative.