Circle Stock Drops 18% at One Point; US Clarity Act Draft Proposes Restricting Stablecoin Rewards

SmartContractAuditor · 2026-03-24T17:17:42+00:00

On Tuesday morning in the US stock market, Circle, the issuer of USDC, saw its stock price decline 18%, while Coinbase fell approximately 8%. A new proposal called the Clarity Act would restrict stablecoin balance rewards or potentially ban payments based on coin-holding yields. Analysts point out that this could impact the revenue distribution models of Circle and Coinbase. Meanwhile, Tether, the issuer of USDT, has hired an accounting firm to conduct a reserve audit. Market reaction may appear excessive, especially following Circle's stock price surge of 170%.

SmartContractAuditor

2026-03-24 17:17:42

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Odaily Planet Daily News: On Tuesday morning, US stocks opened lower, with USDC issuer Circle (CRCL) stock price dropping as much as 18%, and crypto platform Coinbase (COIN) falling about 8%.

According to CoinDesk, the latest draft of the US Clarity Act proposes to restrict stablecoin balance rewards, including banning rewards for passive stablecoin balances and prohibiting structures that are economically equivalent to interest. Mizuho analyst Dan Dolev stated that the draft might ban earnings solely from holding stablecoins and restrict any practices that make the plan equivalent to bank deposits in any way.

The report mentioned that the GENIUS Act previously prohibited issuers from directly paying yields to users, but issuers and platforms arranged rewards through reserve asset income sharing. Circle, for example, earns interest on the assets backing USDC and shares profits with Coinbase, which in turn offers rewards to users. Keyrock digital asset researcher Amir Hajian said that the latest Clarity Act draft, by banning arrangements “economically equivalent to interest,” points to the above “yield penetration” model.

Additionally, Tether, the issuer of USDT, announced that it has hired one of the “Big Four” accounting firms to conduct a comprehensive audit of its USDT reserves. The report also noted that this decline occurred after Circle’s stock price had risen a total of 170% since early February. Clear Street analyst Owen Lau said the market reaction might be excessive; market participants are also factoring in rate hike expectations. (CoinDesk)

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