- Hoskinson calls the CLARITY Act “horrific” and warns of SEC overreach
- Stablecoin yield restrictions remain a major sticking point
- Banks and crypto firms clash over what counts as “interest”
Cardano founder Charles Hoskinson has sharply criticized the proposed CLARITY Act, arguing that the bill could harm rather than help the crypto industry. In a recent broadcast, he described the legislation as deeply flawed, claiming it effectively treats every crypto asset as a security by default. According to him, that framing could create bureaucratic red tape and open the door for future SEC enforcement actions against new projects.
Hoskinson also warned that the bill lacks meaningful protections for DeFi platforms, prediction markets, and certain stablecoin structures. One of his core concerns centers on the restriction of yield on stablecoin balances. In his view, these provisions could stifle innovation rather than provide clarity.
Stablecoin Yield Debate Intensifies
The stablecoin rewards issue has become a focal point in negotiations between banks and crypto firms. Traditional financial institutions are reportedly pushing for a broad ban on stablecoin yield products, arguing that they resemble interest-bearing deposits. Some crypto participants have signaled openness to narrower limits that apply only to stablecoin balances.
Hoskinson believes the bill’s language could be weaponized during rulemaking, especially if regulatory agencies interpret it aggressively. He has also criticized the urgency surrounding the bill, suggesting that rushing passage while acknowledging potential future amendments signals that core issues remain unresolved.
JPMorgan Pushes for “Level Playing Field”
JPMorgan CEO Jamie Dimon has taken a different angle, calling for parity between banks and crypto companies. In a CNBC interview, Dimon argued that if crypto firms distribute stablecoin rewards, those products resemble interest and should be regulated accordingly. From his perspective, offering yield without bank-level oversight creates an uneven competitive landscape.
Dimon emphasized that his bank actively uses blockchain technology and has developed its own deposit coin. He framed the push for stricter stablecoin reward rules not as anti-crypto, but as an effort to ensure balanced regulation. In his words, competition is welcome, but it must operate under comparable standards.
Passage Likely, Debate Ongoing
Despite the disagreement, momentum behind the CLARITY Act appears strong. The Senate Banking Committee is reportedly preparing for a markup, and prediction market data suggests high odds that the bill could be signed into law this year. Industry leaders such as Ripple CEO Brad Garlinghouse have argued that imperfect legislation should not block progress, noting that amendments can follow.
The divide highlights a broader tension within crypto. Some leaders favor rapid regulatory certainty, even if the framework requires refinement. Others worry that flawed definitions could shape enforcement for years. The outcome will not only define stablecoin policy, but potentially set the tone for how the U.S. treats digital assets going forward.
