The most anticipated crypto bill in the United States is losing ground. Galaxy Digital now estimates a 60% chance of adoption of the CLARITY Act, compared to 75% previously. At issue: an American Senate faced with an increasingly busy agenda.
In brief
- Galaxy Digital reduces the chance of passage of the CLARITY Act to 60%.
- The main obstacle concerns the busy schedule of the US Senate.
- The crypto sector is still awaiting a consistent federal regulatory framework.
The CLARITY Act is losing momentum in Washington
Director of Research at Galaxy Digital Alex Thorn revises downward his estimates for the adoption of crypto Clarity Act bill. He points to the lack of available days before the parliamentary recess in August.
Postponed a month ago, the crypto text must in fact still:
- obtain 60 votes in the Senate;
- go through debates and amendments in plenary session;
- be harmonized with the version of the Senate Agriculture Committee;
- cross the House of Representatives.
However, the Senate wasted several weeks managing other priorities. Particular mention is made of funding for ICE and border patrols. Added to this is the failure of the reauthorization of Section 702 of FISA, rejected by 47 votes to 52. The latter now monopolizes the agenda for the coming week.
Result: the useful window before August is reduced to a few days in July. Not enough for one crypto law text as complex, without a clear commitment from senatorial leader John Thune.
Beyond time, political blocking points persist
Democrats, led by Senator Ruben Gallego, are calling for ethics provisions related to conflicts of interest. Other senators want toReinforced guarantees against money laundering and sanctions-related risks.
Added to this is a major debate over stablecoins. Banks in fact refuse to allow issuers of digital dollars to be able to offer passive returns to their holders. They believe that this would amount to competing with bank deposits without the regulatory constraints that apply to them.
That's not all! JPMorgan analysts also believe the midterm elections could push back crypto market structure reforms.
What impact for the crypto sector?
THE CLARITY Act aims to create the first comprehensive federal framework for digital assets in the United States. Concretely, it would clarify the respective roles of the SEC and the CFTC. Expected result: less legal uncertainty for issuers, exchange platforms and crypto investors.
The text has already taken a crucial step on May 14 by being adopted in the Senate committee by 15 votes to 9. This sudden slowdown therefore directly calls into question the ambitions of several leading political figures. We mainly cite Senator Cynthia Lummis, a fervent defender of digital assets, who had set an ambitious target: having this structuring law passed before the July 4 national holiday. A promise that today seems out of reach!
For the crypto ecosystem, the stakes also seem titanic. Without this crypto law, the legal vagueness persists in fact. Enough to encourage innovative companies to flee the United States.
In any case, crypto investors will have to be patient. Washington's reaction in the coming weeks will determine whether the text is simply postponed or if it gets bogged down permanently.
Maximize your Tremplin.io experience with our 'Read to Earn' program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.
