Everyone in the market is watching the regulatory turf war between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), debating which meme coins belong to the “digital commodity” category. This is just a surface-level interpretation that has long been priced in by the market.
The true money-making logic behind the CLARITY Act lies elsewhere: the Act quietly delineates the legal boundaries for institutions to conduct DeFi business, while, under strong bank lobbying, directly closing off the mainstream channel for retail users to earn passive income through idle stablecoins.
This will not only usher in a new round of institutional funds entering DeFi but also drive massive capital into specific protocols that have already established compliance frameworks.
Here are the 7 key beneficiary projects I have identified.
Understanding the CLARITY Act in 30 Seconds
The Act was passed by the House in July 2025 (voting 294 in favor, 134 against); it entered the Senate Banking Committee review stage on May 14, 2026 (Translator's Note: The CLARITY Act was approved by the Senate Banking Committee on May 14).
Summarizing the core of the CLARITY Act in two sentences:
· It clarifies the regulatory jurisdiction between the SEC and CFTC, with digital commodities falling under CFTC’s jurisdiction;
· It establishes safe harbor rules for DeFi protocols, node validators, and open-source developers, no longer simply categorizing them as money transmitters or brokers.
The most crucial part of this article is Section 404 regarding stablecoin yields: the GENIUS Act, which took effect in the U.S. last year, prohibits stablecoin issuers from directly paying interest to users; however, trading platforms, DeFi platforms, and intermediaries could still offer users yield on their idle funds.
Why the Impact of the CLARITY Act Goes Beyond DeFi Legalization
Once the CLARITY Act is officially implemented, it will immediately trigger two major changes:
· Institutional Funds Removing Entry Barriers. BlackRock, Apollo, Deutsche Bank, pension funds, corporate treasuries, etc., who were previously on the sidelines, are now able to make large-scale investments following the clarification by the CFTC and the establishment of a DeFi safe harbor. The compliance teams were unable to assess whether the assets in question were securities and therefore hesitated to allocate significant funds. Now, with the CFTC's clear jurisdiction and the DeFi safe harbor in place, institutions can finally enter the market in a big way.
· Profit-Seeking Funds Exiting Idle Stablecoin Yield Farming. The previous model of earning approximately 5% annualized returns by simply holding USDC on a trading platform will no longer exist. Hundreds of billions of dollars seeking stable returns must now find new investment outlets.
Therefore, two massive waves of capital (institutional investors finally entering the market + retail investors seeking returns) will flow into the same type of assets: compliant, with practical use cases, and structured yield-generating products.
The following protocols are specifically tailored for this new regulatory landscape.
Pendle: Underlying Yield Infrastructure Layer
Pendle is the DeFi protocol with the highest compatibility with the CLARITY Act. It can split all yield-bearing assets into principal tokens (PT) and yield tokens (YT): holding PT locks in a fixed APY, while holding YT allows users to bet on yield rate changes. The entire process is an active trading and liquidity-providing business activity, not just passive holding for interest.
Pre-Act: Institutions recognized its product mechanics but were limited by regulatory uncertainties, preventing them from participating on a large scale; tokenized real-world assets (RWA) could only exist in pilot or offshore packaging phases; the security qualification of PT and YT tokens was uncertain from a compliance perspective.
Post-Act: PT/YT trading is clearly categorized under CFTC commodity derivatives regulation; the ban on passive stablecoin yields has driven a massive influx of funds into these active business-oriented yield products; large asset management firms like BlackRock can custody tokenized RWA, private credit assets, and provide on-chain fixed income exposure to clients through Pendle.
Example: Apollo Credit Fund ACRED, tokenized through Securitize and packaged into eACRED through the Ember protocol, went live on Pendle in April 2026. Holding PT-eACRED allows for one-click exposure to Apollo's entire credit asset portfolio, including corporate direct lending, asset-backed lending, prime credit, distressed credit, and structured credit.
All products are composable and entirely on-chain.
After the CLARITY Act is implemented, this model will become the standard template for institutional fund entry into the United States, and Pendle will also become a core revenue infrastructure for incremental institutional liquidity.
Key Points to Watch: RWA Asset Pool Lockup Amount, Progress in cooperation with compliance custody institutions, PT tokenized asset issuance scale.
Morpho: On-chain Prime Broker
Morpho focuses on a permissionless lending market and supports customizable risk parameters.
Before the Act is implemented: Using tokenized RWAs as loan collateral poses a risk of being classified as unregistered derivatives; lack of institutionally compliant and trustee-qualified fund pools; clearing and oracle risks make large funds hesitant to participate.
After the Act is implemented: Strategic institutions like Gauntlet and Steakhouse can establish compliant licensed fund pools, customize loan-to-value ratios, oracles, position limits, and KYC admissions; institutions can collateralize loans with stablecoins for real-world assets, engage in leveraged arbitrage, provide market liquidity, all operating within the clear CFTC regulatory framework.
Stablecoin funds squeezed out of passive money markets will continue to flow into the Morpho pool, earning compliant returns through active lending business.
The on-chain prime broker model will be formally launched and operational. Stablecoin funds squeezed out of passive money markets will continue to flow into the Morpho pool, earning compliant returns through active lending business.
Key Points to Watch: Lockup amount of funds managed by institutional strategy providers, addition of new RWA collateral types, number of institutional partnership strategies going live.
Sky (USDS/sUSDS)
Sky (formerly MakerDAO) allows users to deposit USDS to mint sUSDS, earn protocol rewards, including stability fees, U.S. Treasury bond yields, and RWA allocation returns. Sky is considered one of the DeFi products closest to a tokenized money market fund.
However, the question remains: Is depositing USDS to mint sUSDS an active business activity or passive yield farming restricted by regulations?
Sky has always followed the Ethena path, partnering with compliant institutions to build a compliant architecture. If regulations take a lenient stance on "active business exemptions," sUSDS will become one of the largest compliant on-chain financial targets, with inherent RWA asset exposure.
The Stablecoin Yield Ban will directly drive idle USDC funds into the USDS savings product.
Points to Note: Treasury Department and the Commodity Futures Trading Commission to establish rules post-bill passage.
Maple Finance: On-chain Credit Trading Platform
Maple Finance focuses on institutional lending pools. Users deposit stablecoins as lenders, and borrowers undergo rigorous due diligence (market makers, hedge funds, institutional treasury departments); its Syrup pool is open to retail users.
Pre-bill: Unsecured institutional lending has been identified as a compliance risk for unregistered securities; banks and insurance companies cannot participate compliantly due to regulatory ambiguity; after early pool default events, compliance teams are generally adopting a wait-and-see attitude.
Post-bill: Maple officially transitions to a compliant on-chain credit asset issuance platform; banks and insurance companies can participate unimpeded.
Maple itself is institutionally aligned: Syrup pool has integrated with Morpho, enabling cross-protocol credit asset portfolio allocation. Bitwise and Sky had already positioned themselves in the Maple strategy before the bill passed.
The CLARITY Act merely removed regulatory constraints that limited its scalability.
Points to Note: Syrup total pool lock-up, diversification progress of institutional borrowers, and the launch of new credit strategies targeting RWA asset originators.
Centrifuge: RWA Asset Native Issuance Layer
If Pendle is responsible for yield splitting and Maple for the credit fund pool, Centrifuge is further upstream—the origin of real-world asset tokenization. Private credit, commercial bills, structured credit tranches, SME loans can all be wrapped as on-chain tokens, seamlessly integrating into the entire DeFi ecosystem.
Pre-bill: Real-world credit asset tokenization was only in the experimental stage; whether tokens belong to securities, commodities, or a completely new category is qualitatively ambiguous, causing institutions to hesitate to invest; underlying assets lack federal-level custody and settlement rules; most pool sizes are limited, only able to operate through offshore structures.
Post-bill: Centrifuge will become the core gateway for RWA asset tokenization; the regulatory classification of tokenized private credit tranche assets is clear, can be compliantly custodied, and used on a large scale as institutional lending collateral; banks and asset management firms can participate on-chain in SME financing, bill discounting, structured credit, and other real-world business without the need for offshore structures.
STRC-Backed Protocol: Fixed Income On-Ramp
Strategy has issued perpetual preferred shares backed by STRC, listed on Nasdaq, with an annualized dividend yield of around 11.5%, adjusting the dividend monthly to maintain a share price close to a $100 face value. Apyx and Saturn Credit are two major mainstream STRC wrapping protocols: Apyx has issued apxUSD and apyUSD (with a total supply exceeding $4 billion); Saturn has issued USDat and sUSDat; both have been listed on Pendle to establish the PT/YT trading market.
Pre-Legislation: Although the entire business path has been formed, U.S. compliant funds cannot mass custody, restructure, or repackage such wrapped assets.
Post-Legislation: PT trading falls under CFTC commodity oversight, with DeFi Safe Harbor protocols ensuring compliance; large U.S. compliant funds can buy Apyx and Saturn-related PT tokens in bulk, lock in fixed income for around 12 months, then package them through traditional brokerage channels into fixed income financial products for retail investors.
The complete process is as follows: Strategy issues STRC → Apyx/Saturn on-chain wrap dividend earnings → Pendle splits into PT principal tokens and YT yield tokens → U.S. compliant funds buy PT in large amounts to lock in fixed income → package as a "Bitcoin-linked fixed income product (with an annualized yield of around 12%)" available for retail purchase.
Key Points to Note: the locked amount of related PT tokens, whether U.S. compliant funds will launch fixed-income products linked to STRC, and the monthly dividend adjustment of STRC.
Common Logic of the Seven Protocols
A high-level view reveals a unified pattern among the seven protocols:
· These protocols, prior to regulatory pressure, had already laid out KYC compliance and business-scenario-based architecture;
· CFTC jurisdictional division + DeFi Safe Harbor completely alleviates institutions' biggest security classification risk;
· The stablecoin passive income ban channels massive funds into such structured, operationally-backed, RWA-endorsed products;
· Institutions will naturally become the adopters, seamlessly overlaying their existing custody and prime brokerage infrastructure onto these DeFi protocols.
Some Points to Consider
· The bill has not yet been finalized. Currently, it has only passed through committee review and still needs to go through the process of merging the House and Senate versions, meeting the 60-vote threshold in the Senate, reconciling the texts of both chambers, and receiving the President's signature. The prediction market Polymarket gives a 76% probability of passage by 2026, but this high probability does not guarantee its success.
· All protocols face inherent DeFi risks, including smart contract vulnerabilities, oracle failures, stablecoin de-pegging, and counterparty credit risk. CLARITY only clarifies the regulatory boundaries and does not eliminate investment risks.
· The concept of "Buy the Rumor" implies a premise: institutions will enter the market at the expected pace. While consensus is strong, the actual implementation timeline is often slower than the trading price suggests, and institutional onboarding usually requires months of adjustment.
Summary
The CLARITY bill is not just a simple story of "DeFi legalization"; that is the surface narrative, already priced in by the market.
The real second-order market logic is: When passive stablecoin yields are locked down, where will the massive profit-seeking capital flow? Which protocols and verticals can withstand an inflow of institutional capital without needing temporary compliance restructuring? This does not mean that the token prices of these protocols will inevitably rise; the tokenomics still require a separate analysis.
Welcome to join the official BlockBeats community:
Telegram Subscription Group: https://t.me/theblockbeats
Telegram Discussion Group: https://t.me/BlockBeats_App
Official Twitter Account: https://twitter.com/BlockBeatsAsia
