Crypto regulation took a meaningful — though complicated — step forward this week.

A bipartisan manager’s amendment released by Senate Banking Chair Tim Scott outlines an updated framework for how digital assets could be regulated in the US, as lawmakers try to reconcile competing House and Senate proposals.

The headline change: payment stablecoins would no longer be allowed to pay interest or yield simply for being held.

However, the bill still permits activity-based incentives, meaning users could earn rewards for actions like transacting, staking, providing liquidity, or posting collateral.

In other words, passive yield may be out — but participation-based rewards are still on the table.

The proposal also includes a developer liability shield, backed by Senators Lummis and Wyden, which aims to protect developers building open-source crypto infrastructure from being treated like financial intermediaries. That provision has been welcomed by many builders across the ecosystem.

Not everyone is happy. Major industry players — including Coinbase — have raised concerns that the updated language could limit product flexibility and innovation. Meanwhile, a previously discussed ethics clause related to political crypto holdings was removed entirely, helping move the bill closer to a committee markup.

The big takeaway?

This isn’t the final rulebook — but it’s another sign that crypto regulation in the US is shifting from theory to specifics. Progress is happening, though tradeoffs are becoming clearer as lawmakers try to balance innovation, consumer protection, and political realities.

For users, builders, and platforms alike, 2026 is shaping up to be a year where how crypto works matters just as much as what it does.