The latest version of the Clarity Act cryptocurrency bill is in the spotlight primarily because of its rules on stablecoins. In practice, it may affect decentralized finance (DeFi) and the tokens linked to it the most, according to a report by 10x Research.
At the heart of the proposal is a ban on offering yield, or anything resembling it, as a reward, on stablecoin balances. That effectively ends the idea of ​​stablecoins as on-chain savings products and redefines them as pure payment avenues.
“This represents a clear recentralization of performance,” wrote Markus Thielen, founder of 10xResearch. This is because the proposal reduces the performance of banks, money market funds and regulated wrappers, leaving crypto-native platforms with less room to compete on performance.
That change could also affect DeFi, despite initial hopes that it could benefit.
The logic was that if centralized platforms couldn’t deliver performance, users would move up the chain, Thielen said.
But that means that DeFi escapes the same rules. In practice, the Clarity framework is likely to be extended to front-end interfaces and token models, especially when fee generation or governance starts to look like equity, he said.
This puts a wide swath of the sector in the spotlight. Decentralized exchanges like Uniswap (UNI), and dYdX (DYDX), as well as lending protocols like Aave and they could face tighter restrictions on how they operate and distribute value, the report argued. The result could be lower volumes, reduced liquidity, and weaker token demand.
On the other hand, the proposed regulation is “structurally optimistic” for infrastructure players like Circle (CRCL), as it integrates stablecoins deeper into payment lanes, Thielen said.
