Lummis and Moreno Join Credit Card Competition Act Amid CLARITY Dispute

A new development has emerged in the ongoing fight over the CLARITY Act. Senators Cynthia Lummis and Bernie Moreno have become cosponsors of the Credit Card Competition Act, a bill strongly opposed by banking groups.

The move comes as lawmakers are still trying to reach a bipartisan agreement on the CLARITY Act, which is currently stuck due to disagreements over stablecoin yield. Banks have pressed lawmakers to restrict arrangements that could allow crypto platforms to offer returns resembling interest on deposits, arguing that it could draw deposits away from banks and reduce funds available for lending.

Lummis has expressed frustration with the latest setback in CLARITY negotiations, stating that lawmakers had 'come too far to quit now' and pledging to continue working with colleagues to get the legislation finished. The Credit Card Competition Act would require greater network competition in credit-card transactions, which banking groups argue could undermine card rewards, increase fraud risks, and impose additional costs.

Despite the added complication, Senate leadership still plans to begin the cloture process before recess, keeping September action possible for CLARITY.