Coinbase keeps its USDC rewards program
Stablecoin yields have been among the most contentious issues in the CLARITY Act for months. BrefCrypto had already covered the standoff between Coinbase and Washington over stablecoin rewards.
According to Matt Hougan, the final version negotiated in the Senate would have barred platforms from paying interest or yield simply for holding a stablecoin, with penalties potentially reaching several million dollars. Bitwise therefore believes the bill’s blockage leaves Coinbase in a more favorable commercial position.
On September 15, the Senate failed to secure the 60 votes needed to advance H.R. 3633. The cloture motion received 49 votes to 50. The Senate nevertheless says a motion to reconsider has been filed, so it would be premature to say the bill is definitively dead.
Coinbase continues to offer USDC rewards in the meantime. Its U.S. page currently advertises 3.75% for certain Coinbase One members, with the rate subject to change depending on conditions and region.
This is a significant difference from a traditional bank: the exchange can use the stablecoin as a customer-acquisition and retention product.
The GENIUS Act leaves an opening for exchanges
Why can Coinbase still offer this yield when the United States has already passed a stablecoin law?
It comes down to the wording of the GENIUS Act, which took effect in July 2025. The law bars stablecoin issuers from directly paying holders any form of interest or yield solely because they hold or use the token.
Circle, which issues USDC, falls into that category.
Coinbase is not the issuer.
Bitwise believes this distinction leaves exchanges and other intermediaries free to fund rewards programs themselves, unless another rule prohibits them. This is Hougan’s analysis of the current framework, not a court decision definitively upholding the model.
The issue helps explain why U.S. banks pushed so hard during the negotiations. They fear that stablecoin yields could attract some of the deposits that traditionally fund their business. BrefCrypto had already reported that Senator Josh Hawley threatened to block the CLARITY Act precisely because of this conflict.
Coinbase, by contrast, argues that rewards can boost competition and encourage the adoption of digital dollars.
Two financial models are beginning to compete for the same pool of money.
The advantage remains fragile
Hougan sees other consequences from the failed vote as well. In his view, established major exchanges are temporarily avoiding a new federal framework that would have made it easier for competitors to enter the spot market. He also believes some of the SEC’s recent initiatives give the industry faster solutions than the several years of new regulations envisioned by the bill.
But the situation also has a downside: less legislation also means less lasting certainty.
Rules issued by federal agencies can change more easily than legislation passed by Congress. Hougan himself acknowledges that a future administration could alter some regulatory approaches.
That is precisely why Circle supported the CLARITY Act. The USDC issuer believed the bill should complement the GENIUS Act by giving the U.S. crypto market a more stable long-term framework. BrefCrypto had detailed Circle’s appeal to Congress a few days before the vote.
Coinbase therefore finds itself in a paradoxical position. The CLARITY Act’s blockage reduces the regulatory visibility the industry had sought for years, while preserving a particularly attractive activity: paying rewards on USDC balances.
At 3.75%, the reward becomes more than a simple marketing bonus. It gradually brings Coinbase onto ground historically occupied by banks: persuading customers to leave their dollars on a platform.
For Bitwise, that is precisely where the CLARITY Act setback becomes a commercial advantage.
