The stablecoin rewards mechanism is becoming a flashpoint in U.S. crypto regulation. A major exchange recently signaled to lawmakers that it may reconsider its policy support if proposed crypto legislation tightens reward payout restrictions beyond simple disclosure requirements. This isn't just internal posturing—the conflict is actively fracturing bipartisan consensus on the broader market-structure bill moving through the Senate.

Here's what's actually happening: The exchange argues that basic transparency rules are reasonable, but capping or restricting how rewards flow to users crosses a line that could push it away from supporting the entire legislative package. That threat matters because industry backing has been crucial to maintaining political support across both parties.

The problem? Every restriction proposal splinters the coalition a bit more. If reward structures remain contested, the whole market-structure bill could face serious delays or even fail to advance. It's a classic case where one unresolved detail threatens to derail months of negotiation work.