Blab Crypto
Senates August Break Leaves XRPs CLARITY Act on Hold, Institutional Investors Await Final Legislation
The U.S. Senate is set to reconvene on Monday, August 3, after a brief recess that will extend until September 14. The CLARITY Act—legislation that would formally codify the Commodity Futures Trading Commission’s (CFTC) classification of XRP as a digital commodity—has yet to be scheduled for a floor vote, leaving the bill stalled amid partisan politics, regulatory concerns and competing legislative priorities.
The bill’s journey began in the House, where it passed in July 2025, and continued in the Senate Banking Committee, which cleared it on May 14, 2026, with a 15‑9 vote. It was added to the Senate’s list of bills slated for a floor vote on June 1, but Senate Majority Leader John Thune has not yet granted the bill time on the chamber’s floor. With Republicans holding 53 seats and the bill requiring 60 votes to pass, Democratic support is essential. Only two Democrats have publicly opposed the measure, and the bill’s passage is further complicated by opposition from banks and a push for stronger ethics provisions.
Banks argue that the bill’s stablecoin rules—allowing exchanges to pay returns to holders—could divert deposits from traditional banking. Democrats, meanwhile, want a clause that would bar former President Trump and other senior officials from participating in crypto projects. The latest ethics provision was sent to the White House on July 30, and the administration’s response could determine whether the Senate will even consider the bill this week.
Senator Thune has prioritized nominations and a Russia sanctions bill over the CLARITY Act and stated on July 23 that a vote before the recess is unlikely. The most the bill can advance by Friday is a cloture motion, which would place it first in line when the Senate returns.
Market reactions to the bill’s milestones have been muted. XRP traded at $1.45 on May 14, spiked to $1.54 after the committee vote, and then fell to $1.33 by late May. A similar pattern occurred in mid‑July when Trump agreed to the ethics provision; XRP rose 3.5% intraday from about $1.11 to $1.1511 but the gains were short‑lived. The coin has traded between $1.05 and $1.08 since July 27, when the Senate set the bill aside.
The CLARITY Act would formalize the CFTC’s oversight of XRP, a status that the SEC and CFTC jointly recognized in a March 17 interpretation. That interpretation is not law, and the next administration could reverse it. Institutional investors—pension funds, asset managers, and bank trust desks—have been waiting for permanent legal certainty before committing large positions. XRP exchange‑traded funds (ETFs) recorded $131.94 million in inflows in May, the strongest month of 2026, during the period the bill was moving through committee.
If the bill is not moved this week, the delay will cost XRP at least six weeks, as the Senate will not resume legislative business until September 14. September is the final window for the bill this year, because both chambers will be largely inactive in October ahead of the November 3 midterm elections. The bill would also need to return to the House for a vote before it reaches the President’s desk, and that must occur in the same narrow September timeframe.
In short, the Senate’s actions this week determine how much of the September window the CLARITY Act will occupy. A cloture motion filed by Friday would give the bill priority on September 14, whereas a delay would force it to compete for floor time again.
The outcome of the CLARITY Act will have implications beyond XRP. If passed, it would establish a regulatory framework for the broader crypto industry, potentially influencing stablecoin rules, AML/KYC requirements, and the role of the CFTC in overseeing digital assets.
The bill’s future remains uncertain, but its passage would provide the institutional clarity that has been a major hurdle for investors and could set a precedent for how the U.S. treats digital commodities.
The bill’s journey began in the House, where it passed in July 2025, and continued in the Senate Banking Committee, which cleared it on May 14, 2026, with a 15‑9 vote. It was added to the Senate’s list of bills slated for a floor vote on June 1, but Senate Majority Leader John Thune has not yet granted the bill time on the chamber’s floor. With Republicans holding 53 seats and the bill requiring 60 votes to pass, Democratic support is essential. Only two Democrats have publicly opposed the measure, and the bill’s passage is further complicated by opposition from banks and a push for stronger ethics provisions.
Banks argue that the bill’s stablecoin rules—allowing exchanges to pay returns to holders—could divert deposits from traditional banking. Democrats, meanwhile, want a clause that would bar former President Trump and other senior officials from participating in crypto projects. The latest ethics provision was sent to the White House on July 30, and the administration’s response could determine whether the Senate will even consider the bill this week.
Senator Thune has prioritized nominations and a Russia sanctions bill over the CLARITY Act and stated on July 23 that a vote before the recess is unlikely. The most the bill can advance by Friday is a cloture motion, which would place it first in line when the Senate returns.
Market reactions to the bill’s milestones have been muted. XRP traded at $1.45 on May 14, spiked to $1.54 after the committee vote, and then fell to $1.33 by late May. A similar pattern occurred in mid‑July when Trump agreed to the ethics provision; XRP rose 3.5% intraday from about $1.11 to $1.1511 but the gains were short‑lived. The coin has traded between $1.05 and $1.08 since July 27, when the Senate set the bill aside.
The CLARITY Act would formalize the CFTC’s oversight of XRP, a status that the SEC and CFTC jointly recognized in a March 17 interpretation. That interpretation is not law, and the next administration could reverse it. Institutional investors—pension funds, asset managers, and bank trust desks—have been waiting for permanent legal certainty before committing large positions. XRP exchange‑traded funds (ETFs) recorded $131.94 million in inflows in May, the strongest month of 2026, during the period the bill was moving through committee.
If the bill is not moved this week, the delay will cost XRP at least six weeks, as the Senate will not resume legislative business until September 14. September is the final window for the bill this year, because both chambers will be largely inactive in October ahead of the November 3 midterm elections. The bill would also need to return to the House for a vote before it reaches the President’s desk, and that must occur in the same narrow September timeframe.
In short, the Senate’s actions this week determine how much of the September window the CLARITY Act will occupy. A cloture motion filed by Friday would give the bill priority on September 14, whereas a delay would force it to compete for floor time again.
The outcome of the CLARITY Act will have implications beyond XRP. If passed, it would establish a regulatory framework for the broader crypto industry, potentially influencing stablecoin rules, AML/KYC requirements, and the role of the CFTC in overseeing digital assets.
The bill’s future remains uncertain, but its passage would provide the institutional clarity that has been a major hurdle for investors and could set a precedent for how the U.S. treats digital commodities.
