The Clarity Act could potentially create a new market focused on "yield-as-a-service," according to Joe Vollono, chief commercial officer at the stablecoin infrastructure firm STBL.

Central to this discussion is Section 404 of the proposed legislation, which would restrict Digital Asset Service Providers (DASPs) and their affiliates from offering yield simply based on the act of holding a digital asset.

This provision could significantly alter the way crypto users generate returns, shifting the industry away from passive "hold-to-earn" models and towards more active, compliant yield-generation approaches.

“What this effectively does is shift the industry from a hold-to-earn market to a use-to-earn market,” Vollono explained in an interview with CoinDesk. “You’re going to need compliant yield strategies to generate rewards on what would otherwise be idle capital.”

The Clarity Act has received approval from the Senate Banking Committee and is anticipated to proceed to the full Senate for a merge with the Senate Agriculture Committee version of the bill, with a hopeful timeline for a full vote as soon as July. Following that, regulators would have roughly a year to implement the framework.

Vollono, who has over seven years of experience at Morgan Stanley and has worked at SIFMA on market structure and advocacy issues, believes that the implications of the Clarity Act reach beyond yield products. He argues that regulatory clarity could pave the way for large-scale institutional involvement in crypto markets.

“Once these issues are resolved, it allows capital at scale to enter the market,” he stated. “That’s the real catalyst here.”

Many view the passage of the Clarity Act as a pivotal moment for crypto markets, as it would establish the first comprehensive U.S. regulatory framework for digital assets, resolving years of ambiguity regarding the jurisdiction of tokens under the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC).

The legislation would provide clearer guidelines for exchanges, brokers, stablecoin issuers, and decentralized finance platforms, which many analysts argue are necessary for large institutional investors, banks, and asset managers to allocate capital effectively. Proponents suggest that regulatory clarity could mitigate legal risks, enhance consumer protections, and furnish traditional financial firms with the compliance structures needed to develop crypto products and services domestically.

The role of AI

According to Vollono, this shift is likely to lead to the emergence of a new layer of infrastructure providers dedicated to compliant yield generation. He anticipates that many of these services will leverage artificial intelligence to manage regulated capital flows.

Potential beneficiaries of this trend include decentralized finance (DeFi) infrastructure providers, vault curators, collateral management platforms, automated treasury services, lending markets, and reward systems.

“All of this can be automated by AI in a regulated market,” he asserted.

Vollono noted that the essential technology already exists, citing smart contracts, oracles, DeFi frameworks, and API-based infrastructure that can be adapted to comply with regulatory standards.

“This creates a whole new world,” he remarked.

Legislation

The ongoing discussions surrounding the legislation have highlighted the tensions between traditional banks and the crypto sector, particularly in regard to stablecoins and the potential for deposit migration.

“There’s a lot at stake,” Vollono pointed out. “Banks are worried about deposit flight, but I think that concern is largely overstated.”

He explained that the conventional fractional reserve banking model relies on banks maintaining substantial capital bases to lend out for credit and liquidity creation. If deposits transition into tokenized dollars or yield-bearing blockchain products, it could put pressure on this model.

Nevertheless, Vollono views the eventual compromise as advantageous for established institutions rather than a threat to their existence.

“Smart incumbents are going to compete,” he stated. “Banks don’t necessarily have to give up market share.”

He suggested that banks might eventually collateralize reserves to issue their own stablecoins and generate compliant yield under the Clarity framework, which could lead to entirely new business models.

Stablecoin 2.0

This dynamic is central to STBL’s own vision.

The firm describes itself as “stablecoin 2.0,” advocating for a departure from the traditional centralized issuer model that currently dominates the market.

Instead, STBL is developing infrastructure that enables users to mint stablecoins backed by real-world assets while retaining the economics generated by the underlying reserves.

“Users that provide value into the ecosystem should participate in the economics,” Vollono stated.

The company’s infrastructure is designed to facilitate compliant yield management while allowing users, rather than centralized issuers, to benefit from the yield produced by reserve assets.

Vollono believes that the Clarity Act could provide the regulatory foundation necessary to expedite this transition. "I’ll tell you what the Act makes clear: money-as-a-service has arrived," he added.