Banking Lobby Wins a Political Battle Inside a Losing Vote Before the U.S. Senate took up the CLARITY Act on September 15, Senator Jerry Moran of Kansas introduced an amendment that would tig
Before the U.S. Senate took up the CLARITY Act on September 15, Senator Jerry Moran of Kansas introduced an amendment that would tighten the bill's limits on stablecoin rewards. Seven Republican senators signed on as co-sponsors, with Moran formally introducing the amendment ahead of the Senate's consideration of the bill.The amendment would have made a key change to the bill's yield restrictions, changes that were requested by bank advocates and fiercely opposed by the crypto industry.
More than 12 senators co-sponsored the amendment, with Republicans making up half of that group, including Susan Collins, Cindy Hyde-Smith, John Curtis, John Cornyn, Lisa Murkowski, and Josh Hawley. The effort reflected a sustained lobbying campaign by traditional financial institutions. Banks warned that the bill's stablecoin provisions could pull deposits out of traditional financial institutions.Moran framed his concerns in local terms, saying he viewed stablecoin rewards as "a threat to local lending in a place like Kansas where farmers and ranchers depend upon a local financial institution."
Moran's opposition extended beyond the amendment itself. He ultimately voted against advancing the CLARITY Act during the September 15 procedural vote. The bill failed to get the 60 votes needed to advance, with the final tally coming in at 49 to 50, not even managing to win a majority.The Clarity Act fell 10 votes short of the 60-vote threshold needed to advance most legislation in the chamber, as four Republican senators, Jerry Moran, Susan Collins, Josh Hawley, and Thom Tillis, joined all Democrats in voting against it.
After voting against the bill, Senator Thom Tillis of North Carolina filed a motion to reconsider, leaving the door open for the process to be reopened in the future. However, the path forward looks narrow. The vote effectively put the bill on ice, as Congress is set to depart Washington this month ahead of the November midterm elections.According to Wyoming Senator Cynthia Lummis, the bill's biggest supporter in Congress, the failure to reach cloture means the bill is all but dead. "It's over," she said.
The stablecoin rewards dispute was one of several unresolved issues that weighed on the bill. The vote followed months of negotiations over stablecoin rewards, safeguards against illicit finance, and ethics restrictions covering President Donald Trump's crypto interests. For the banking industry, though, the Moran amendment represented a meaningful gain. Lost in the failed vote was what Punchbowl News described as a significant political victory for the banking lobby: a little-noticed amendment to bolster stablecoin yield restrictions with broad bipartisan support.
Sources:CoinDesk: Crypto's biggest Senate push falls flat as the Clarity Act fails to clear a crucial procedural votePunchbowl News: The ticking time bomb banks didn't useCNBC: Crypto Clarity Act faces crucial Senate vote as Democrats urge changes
