Circle Tanks 18% as US Clarity Act Threatens Stablecoin Yields
Draft legislation targeting stablecoin rewards sends Circle and Coinbase stocks tumbling hard.
Circle got hammered. Shares plunged as much as 18% after a draft version of the US Clarity Act surfaced with provisions that would impose strict limits on stablecoin yield. Coinbase took collateral damage too, dropping roughly 8%.
The culprit: language in the latest draft that would restrict stablecoin rewards — the interest-like returns that have become a key selling point for issuers and a revenue driver for platforms listing them.
For Circle, the USDC issuer, this is an existential-level threat to its business model. Coinbase, which has a revenue-sharing deal tied to USDC, faces margin pressure if yield restrictions go through.
The bill is still in draft form. But the market isn't waiting around to see how it plays out. Crypto-adjacent stocks are pricing in the pain now.