The Daily Peg
Stablecoin yield plays get legitimised as US lawmakers finally agree on Clarity Act's treatment of rewards.
Editorial hello
Why does all the big news always have to happen during holidays?! For those who don’t know, yesterday was a UK Bank Holiday, so we’re in catch-up mode again on Monday’s big news, which is that US lawmakers finally agreed on how stablecoin rewards should be treated.
The general consensus is that the final draft is a win for stablecoins, which get to retain the ability to pay interest whenever flows are not “economically or functionally equivalent” to bank deposit interest.
The consequence is that stablecoin rewards (primarily through the updated language in what has been described as Section 404) will take a pragmatic, activity-based approach that will explicitly accommodate new concepts like Coinbase’s CUSHY tokenized credit fund and similar innovations that tie earnings to governance tokens or participation.
More importantly, the legislation paves the way for what the Peg is dubbing the “conscious recoupling” of payment and credit float. For more on that, see the piece I published last week.
