Ripple CEO Brad Garlinghouse signaled caution on the CLARITY Act's path forward, telling crypto conference attendees on Tuesday that a stablecoin compromise does not guarantee passage of the broader market structure bill.
US lawmakers recently announced a compromise on stablecoin yield provisions, a move many observers treated as a breakthrough for legislation that has stalled in Congress. The compromise addresses yield-bearing stablecoin restrictions, a contentious issue that previously divided Democrats and Republicans on how to regulate tokenized versions of the dollar.
Garlinghouse's remarks underscore lingering uncertainty around the bill's timeline. While the stablecoin deal removes one regulatory roadblock, multiple hurdles remain before CLARITY reaches a floor vote. The legislation must clear committee review, negotiate language across competing regulatory priorities, and secure bipartisan support in both chambers.
The CLARITY Act aims to establish a clear regulatory framework for crypto market structure, assigning oversight roles to the SEC and CFTC. For Ripple specifically, the bill's passage matters substantially. XRP, Ripple's native token, faces ongoing litigation over whether it qualifies as a security. Clearer regulatory guidance could reshape that narrative and reduce XRP's regulatory risk.
The stablecoin compromise reflects negotiation between consumer protection advocates and industry supporters. Yield restrictions remain a point of contention. Some lawmakers want to prevent stablecoin issuers from paying interest to token holders, citing systemic risk concerns. Others argue restrictions hamper innovation.
Garlinghouse's cautious stance reflects the crypto industry's experience with regulatory momentum that evaporates. Previous legislative attempts, including provisions in broader infrastructure bills, have been diluted or abandoned in late-stage negotiations.
The path forward for CLARITY depends on whether momentum from the stablecoin deal translates to votes. The bill needs Republican and Democratic buy-in on market structure definitions, custody rules, and derivatives oversight. Each issue carries separate constituencies and competing interests.
Ripple and other major protocols have increased lobbying efforts. Garlinghouse's public statements signal the company views continued advocacy as essential,