CLARITY will strengthen dollar stablecoins, but Asia wins on yield: HashKey Research
The CLARITY Act, the U.S. Senate’s latest push to establish comprehensive crypto market structure rules, could do more than unlock institutional adoption by also strengthening the U.S. dollar’s role in global digital finance while intensifying competition with Asian crypto hubs over stablecoin capital, according to a researcher from venture fund HashKey.
The Senate Banking Committee on Thursday advanced the Digital Asset Market CLARITY Act in a bipartisan 15-9 vote, pushing the legislation closer to a full Senate vote as lawmakers continue negotiating issues, including anti-money laundering protections and ethics provisions.
Clearer U.S. crypto rules could encourage institutional adoption of regulated stablecoins and deepen their use in payments, settlement, and treasury management across Asia. But if Washington draws a hard line on yield-bearing structures, the same rules could create openings for offshore competitors.
“The impact of the CLARITY Act extends far beyond the U.S. market to the global crypto market,” Tim Sun, senior researcher at HashKey Group, said in an email interview with CoinDesk. “Once the act passes, compliant pathways will be fully opened. Traditional banks, asset management institutions, and sovereign wealth funds will have a more robust legal basis to incorporate crypto assets into their investment frameworks.”
For crypto firms in Asia's hubs like Hong Kong or Singapore, the bigger question is what clearer U.S. rules could mean for stablecoins.
“Many Asian markets share two common characteristics: active cross-border trade and capital flows, and local currencies that are more susceptible to pressure from external shocks,” Sun added. “In an environment where global USD financing costs remain high, and volatility in emerging market currencies has increased, USD stablecoins provide a more flexible liquidity tool for enterprises and investors.”
The result, he said, is that the competition may not be over whether the U.S. or Asia becomes crypto’s dominant regulatory center, but over who captures the flows created by expanding stablecoin adoption.
That tension becomes sharper if Washington takes a restrictive approach to yield-bearing stablecoins, an increasingly contentious issue as policymakers weigh whether stablecoins should compete with bank deposits.
A major flashpoint for CLARITY remains stablecoin yield, where lawmakers struck a compromise barring crypto firms from offering interest that functions like a traditional bank deposit while preserving rewards tied to bona fide on-chain activity.
But banking groups, led by the American Bankers Association, have continued pressing lawmakers for tighter restrictions, arguing even activity-based rewards could encourage deposit flight from traditional banks into digital dollars
“The most critical issue remains the interest-bearing nature of stablecoins,” Sun said. “If the U.S. imposes strict regulations and restrictions, it may create opportunities for regulatory arbitrage.”
That could mean capital flowing toward Asian markets where exchanges, wallets, decentralized finance protocols or third-party financial products offer ways to generate higher returns on stablecoin holdings.
“The market might also introduce various ‘wrapped’ product structures to allow users to capture higher yields,” he said.
Still, Sun argued that clearer U.S. rules would not necessarily weaken Asian hubs like Hong Kong or Singapore.
“The competition between Asia and the U.S. is not a zero-sum game of substitution,” he said. “The focus of future competition will not be about who replaces whom, but rather who can most effectively connect USD liquidity, regional assets, local financial institutions, and compliant channels.”
If Washington succeeds, the crypto industry’s next competitive fight may look less like a battle over token listings and more like a contest over who controls the rails moving digital dollars around the world.