Crypto Clarity Act Still Has a Chance to Pass Despite Tight Senate Schedule

The prospects for the Crypto Clarity Act appear bleak for April, but a potential Senate committee hearing in May could revive the legislation, provided it reaches a final vote by July. According to lobbyists and a lawmaker aide, the bill's progress has been hindered by a stablecoin yield debate, which has caused months of delay. However, negotiations over decentralized finance protections have been largely settled, leaving few obstacles in the way of committee approval. The Senate's legislative calendar is running out of time, with only about a dozen weeks of work remaining before the November congressional midterms. The bill must clear the Senate Banking Committee, which is only the first step in a lengthy process. If the bill manages to get approval from the committee, it will need to be merged with the version that passed the Senate Agriculture Committee. The final legislation is likely to undergo further revisions, particularly with regards to an ethics piece that Democrats want to limit senior government officials from profiting off crypto interests. The bill may still pass if it can overcome the current disputes and gain enough Democratic support. The House would then need to approve the revised bill, which is expected to be a quick process if no further disagreements arise. The last step, President Trump's signature, is expected to be the easiest, although he has introduced some uncertainty by stating that he won't sign any bill until he gets legislation approved that would demand voters prove their citizenship before casting ballots. The Digital Asset Market Clarity Act, if approved, would become the second major crypto bill to become law, following last year's Guiding and Establishing National Innovation for US Stablecoins Act. However, an unresolved stablecoin matter from the GENIUS Act has delayed progress on the Clarity Act, with bank lobbyists expressing concerns that stablecoin rewards programs could jeopardize the banks' business model. The debate has sparked intense rhetoric from crypto insiders, with Coinbase's Chief Legal Officer Paul Grewal stating that you can't be for clarity and against rewards. The White House has leaned into the crypto position, allowing some rewards that don't resemble interest on core bank deposits. A top crypto adviser in Trump's White House, Patrick Witt, has criticized further lobbying by banks as motivated by greed or ignorance. The current version of the compromise has centered around an approach that would ban payment of yield on any product that looks or acts like insurance on a deposit but would still allow firms like Coinbase to structure rewards programs akin to credit-card incentives. However, the lawmakers have been hesitant to release the text, which could spark further negotiation drama. Crypto insiders are urging immediate action, with the CEO of the Digital Chamber stating that a markup must happen to move the bill forward. The odds of the Clarity Act being signed into law in 2026 are roughly 50-50, according to a research note by crypto investment firm Galaxy, with the uncertainty stemming from the sheer number of unresolved questions that must be settled in sequence under severe time pressure. A single further blowup among negotiators could be a fatal delay, although the period after the November elections could offer a final low-odds, last-ditch opening. Crypto lobbyists are playing the long game on the political front, with crypto PACs devoting millions of dollars to backing members of both parties, which could lead to other pressing legislative matters for the industry in the future.