WASHINGTON — America’s Credit Unions and credit union associations from all 50 states urged Senate leaders Tuesday to approve the Digital Asset Market Clarity Act while seeking changes they said would better protect credit unions from potential deposit losses tied to stablecoins.
In a joint letter to Senate Majority Leader John Thune (R-SD) and Minority Leader Charles Schumer (D-NY), the organizations said they support the overall goals of H.R. 3633, the Digital Asset Market Clarity Act of 2025 (CLARITY Act), and praised lawmakers for ensuring credit unions would have a defined role in the emerging digital asset marketplace.
According to America’s Credit Unions, the Senate version of the legislation provides clear legal authority for both federally chartered credit unions and federally insured, state-chartered credit unions to participate in digital asset activities under the oversight of the National Credit Union Administration. The organizations also applauded provisions that would create a pathway for privately insured, state-chartered credit unions to participate in the market.
The groups said the Senate Banking Committee worked with both the credit union industry and the NCUA to strengthen the legislation after it was reported out of committee.
Language Revisions Urged
However, the organizations urged lawmakers to revise language governing the payment of interest or yield on payment stablecoins, arguing the current provisions could weaken protections for traditional depository institutions.
While expressing support for nearly all of the bill, America’s Credit Unions said the stablecoin provisions carry “outsize significance” for credit unions and other financial institutions because they could affect consumer deposits that fund lending.
The organizations pointed to the recently enacted GENIUS Act, which prohibits stablecoin issuers from paying interest or yield, saying Congress recognized such payments could encourage consumers to move deposits away from banks and credit unions.
Concerns Over Rewards & Incentives
According to the letter, subsequent efforts by stablecoin issuers and digital asset exchanges to seek clarification of the law have raised concerns that indirect rewards or similar incentives could effectively bypass the prohibition.
America’s Credit Unions said it appreciates the Senate Banking Committee’s bipartisan effort to address those concerns in Section 404 of the CLARITY Act but believes the language remains too narrow.
Specifically, the organizations said they are concerned the bill could permit “functionally passive reward structures,” even if they are technically tied to account activity, potentially undermining Congress’ original intent. They also argued the legislation should do more to discourage consumers from holding payment stablecoins for extended periods or maintaining specific balances in exchange for incentives.
Warning Shared
The groups warned that failing to strengthen the prohibition could contribute to deposit flight from traditional financial institutions, reducing the funds credit unions use to make loans in local communities.
“Ideally, the CLARITY Act will integrate the world of traditional finance with an emerging digital asset sector with minimal disruption to the millions of Americans who depend on reliable access to credit through their local credit union,” the organizations wrote. “We agree that the goal should not be to pick winners or losers between crypto and traditional finance.”
The letter was signed by America’s Credit Unions and credit union associations representing every state and was copied to all members of the U.S. Senate.
