Blab Crypto
Senate Stalls on CLARITY Act as Crypto Advocates Push for Regulatory Clarity
On June 23, the Senate Banking Committee’s hearing titled "The Affordability Agenda" became a battleground for the future of digital finance. Chief Executive Cody Carbone of the Digital Chamber stepped onto the stage, urging lawmakers to advance the Digital Asset Market Clarity Act (CLARITY Act). He argued that blockchain‑based payment systems could slash transaction costs and broaden consumer access to financial services.
Carbone’s presentation highlighted two key benefits: speed and affordability. Faster settlements would reduce friction for everyday users, while lower fees could make cross‑border remittances cheaper. Yet the senators’ focus drifted. Most members did not engage directly with the cryptocurrency points Carbone raised. Senator Jim Banks, for example, probed the costs of international remittances and compared U.S. dollar‑pegged stablecoins with existing payment methods. Senator John Kennedy, while expressing a general endorsement of digital assets, cautioned that they were not the primary driver of affordability challenges in the United States.
The bill has encountered growing resistance. On the same day, the Alliance to End Human Trafficking (AEHT) sent a letter to Senate Majority Leader John Thune and Minority Leader Chuck Schumer. The organization urged a review of Section 604, which incorporates the Blockchain Regulatory Certainty Act. AEHT warned that the provision could impede law‑enforcement efforts to trace financial activity tied to human trafficking, and called for stronger anti‑money‑laundering safeguards before the bill moves forward.
Gambling industry groups added another layer of concern. They requested that the Senate clarify that the CLARITY Act would not expand the Commodity Futures Trading Commission’s (CFTC) authority over sports‑betting prediction markets. This appeal follows an ongoing dispute between the CFTC and operators such as Kalshi and Polymarket, in which the regulator maintains exclusive jurisdiction.
Industry analysts point to institutional interest as a decisive factor. Ric Edelman, a former investment adviser, noted that regulatory uncertainty remains a major barrier to large pools of capital entering the crypto market. He estimated that up to 95 % of institutions that currently lack crypto exposure could enter the market if the CLARITY Act becomes law. Edelman also cited Bitcoin exchange‑traded fund outflows and opposition from lawmakers such as Bernie Sanders and Elizabeth Warren as contributing to investor caution.
Legally, the Senate Banking Committee has already passed the bill 15‑9, but a floor vote has not yet been scheduled. Senate leadership has not set a date for a markup hearing or a final vote, leaving the bill’s fate uncertain. The Digital Chamber has urged the committee to advance the legislation, arguing that clear regulatory guidance would help the United States maintain a competitive edge in the global digital‑asset market.
At present, the CLARITY Act remains in committee. Key unresolved issues include the scope of Section 604, the extent of CFTC authority over prediction markets, and the inclusion of additional anti‑money‑laundering provisions. The next steps will likely involve a markup hearing, potential amendments, and a floor vote before the 119th Congress concludes in January 2027.
The outcome of the CLARITY Act will shape the regulatory environment for digital assets, influence institutional participation, and determine how U.S. agencies such as the SEC and CFTC divide oversight of securities, commodities, and stablecoins.
Carbone’s presentation highlighted two key benefits: speed and affordability. Faster settlements would reduce friction for everyday users, while lower fees could make cross‑border remittances cheaper. Yet the senators’ focus drifted. Most members did not engage directly with the cryptocurrency points Carbone raised. Senator Jim Banks, for example, probed the costs of international remittances and compared U.S. dollar‑pegged stablecoins with existing payment methods. Senator John Kennedy, while expressing a general endorsement of digital assets, cautioned that they were not the primary driver of affordability challenges in the United States.
The bill has encountered growing resistance. On the same day, the Alliance to End Human Trafficking (AEHT) sent a letter to Senate Majority Leader John Thune and Minority Leader Chuck Schumer. The organization urged a review of Section 604, which incorporates the Blockchain Regulatory Certainty Act. AEHT warned that the provision could impede law‑enforcement efforts to trace financial activity tied to human trafficking, and called for stronger anti‑money‑laundering safeguards before the bill moves forward.
Gambling industry groups added another layer of concern. They requested that the Senate clarify that the CLARITY Act would not expand the Commodity Futures Trading Commission’s (CFTC) authority over sports‑betting prediction markets. This appeal follows an ongoing dispute between the CFTC and operators such as Kalshi and Polymarket, in which the regulator maintains exclusive jurisdiction.
Industry analysts point to institutional interest as a decisive factor. Ric Edelman, a former investment adviser, noted that regulatory uncertainty remains a major barrier to large pools of capital entering the crypto market. He estimated that up to 95 % of institutions that currently lack crypto exposure could enter the market if the CLARITY Act becomes law. Edelman also cited Bitcoin exchange‑traded fund outflows and opposition from lawmakers such as Bernie Sanders and Elizabeth Warren as contributing to investor caution.
Legally, the Senate Banking Committee has already passed the bill 15‑9, but a floor vote has not yet been scheduled. Senate leadership has not set a date for a markup hearing or a final vote, leaving the bill’s fate uncertain. The Digital Chamber has urged the committee to advance the legislation, arguing that clear regulatory guidance would help the United States maintain a competitive edge in the global digital‑asset market.
At present, the CLARITY Act remains in committee. Key unresolved issues include the scope of Section 604, the extent of CFTC authority over prediction markets, and the inclusion of additional anti‑money‑laundering provisions. The next steps will likely involve a markup hearing, potential amendments, and a floor vote before the 119th Congress concludes in January 2027.
The outcome of the CLARITY Act will shape the regulatory environment for digital assets, influence institutional participation, and determine how U.S. agencies such as the SEC and CFTC divide oversight of securities, commodities, and stablecoins.
