The U.S. Senate is advancing the Digital Asset Clarity Act, which would prohibit the Federal Reserve from issuing a retail CBDC without Congressional approval. This move is seen as a major benefit for private stablecoins like USDC and USDT. The bill, which builds on the 2025 GENIUS Act, requires 60 votes to pass. Meanwhile, the DTCC's selection of Stellar for its tokenized securities platform highlights growing institutional adoption.
Clarity Act Senate timeline
- ▪The Digital Asset Clarity Act passed the U.S. House of Representatives in July 2025
- ▪Senators are working to consolidate two versions of the Clarity Act, with a potential floor vote projected by August
- ▪A delay in passing the Clarity Act could push comprehensive crypto regulation to 2030
- ▪The Clarity Act cleared the Senate Agriculture Committee in January and the Banking Committee in May by a 15-9 vote
Federal Reserve CBDC prohibition
- ▪The act would prohibit the Federal Reserve from issuing a retail CBDC without explicit authorization from Congress
- ▪The Clarity Act's main provision is an explicit prohibition on the Federal Reserve issuing a retail Central Bank Digital Currency (CBDC)
Private stablecoin competitive advantage
- ▪A statutory ban on a retail CBDC would remove the primary government-backed competitor to private stablecoin issuers like Circle and Tether
- ▪JPMorgan CEO Jamie Dimon objects to the stablecoin yield provision, arguing it would compete directly with bank deposits
- ▪The Senate Banking version of the Clarity Act includes a provision that allows for yield or rewards on stablecoins
- ▪Tokenized real-world assets on the Stellar network grew from $1 billion in December to approximately $3 billion over five months
- ▪Stellar Development Foundation CEO Denelle Dixon stated that tokenization adoption is unlikely to be derailed if the Clarity Act stalls
- ▪The DTCC has selected Stellar as the first public blockchain for its new tokenized securities settlement platform
GENIUS Act licensing framework
- ▪The GENIUS Act, a stablecoin payments bill signed into law in July 2025, established a licensing framework for the industry
- ▪The Clarity Act is considered the second, sequential piece of legislation building on the GENIUS Act's framework
- ▪According to Stellar CEO Denelle Dixon, the GENIUS Act gave financial institutions confidence in the U.S. government's support for the industry
Senate floor vote requirements
- ▪The Clarity Act requires 60 votes to pass in the Senate
- ▪To reach the 60-vote threshold, Senate Republicans need to secure at least seven votes from Democrats or independents
Circle Tether regulatory positioning
- ▪Circle has pursued MiCA compliance in Europe, positioning its USDC stablecoin for regulated institutional use
- ▪Circle's USDC and Tether's USDT collectively represent the vast majority of global stablecoin trading volume and on-chain liquidity
- ▪Tether's USDT dominates offshore and emerging-market liquidity but faces more regulatory exposure in jurisdictions requiring audited reserves
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