Digital asset heavyweights Coinbase COIN and Circle CRCL are facing an intense wave of selling pressure this Tuesday as a regulatory storm brews in Washington.

The sudden downturn reflects growing investor anxiety over a potential legislative shift that could fundamentally alter how stablecoins – the very “glue” of the crypto economy – are managed and monetized.

Year-to-date, COIN and CRCL have followed sharply divergent trajectories, with the former down over 25% currently while the latter remains up some 100% versus its year-to-date low.

Why did crypto stocks crash on Tuesday?

Today’s rout is mostly driven by a bipartisan legislative proposal aimed at curbing stablecoin yield and rewards.

According to recent reports, US lawmakers…