The crypto market structure bill, known as the CLARITY Act, is running out of time to secure a Senate vote. With only two days remaining before Congress begins its August recess, there are now three possible scenarios for the bill’s future.
Meanwhile, as the chances of a Senate vote continue to fade, the SEC says it is prepared to move forward with crypto regulations on its own.
CLARITY Act Stuck in the Senate
Senate Democrats expect the CLARITY Act’s cloture vote to fail if it reaches the floor this week. The bill needs 60 votes to move forward, but negotiations have stalled over ethics rules tied to public officials and cryptocurrency.
Democrats have warned they will block the procedural vote unless a bipartisan agreement is reached.
Senator Angela Alsobrooks recently dismissed a Republican proposal to leave enforcement to the Justice Department, calling it “wild and unserious” and “not a serious proposal.”
“Without signs of progress from the White House on a bipartisan ethics deal and other breakthroughs, Senate Democrats will deny cloture for the crypto bill.”
Even Senator Ruben Gallego also expressed frustration over the lack of progress, saying,
“We are clearly here, trying to engage constructively. At this point, if they’re not engaging, it’s telling me that they don’t want this to happen.”
Although some Senate leaders are still expected to hold a procedural vote before lawmakers leave Washington for the August recess
Three Possible Outcomes Before August Recess
There are only a few possible outcome left for the bill.
The most likely option is that Senate Majority Leader John Thune files a cloture motion. However, even if that happens, the earliest procedural vote would take place on 7 August, the final day before the recess.
Perhaps that vote would only decide whether the Senate can begin debating the bill, not pass it.
Another option is using unanimous consent to speed up the process, but a single senator can block that request. With Democrats still opposing key parts of the bill, that outcome appears unlikely.
The third possibility is that no vote happens at all. In that case, the Senate will spend its remaining time on judicial nominations and a Russia sanctions package before leaving for recess.
However, the prediction market Polymarket now gives the bill only a 22% chance of reaching a Senate vote before the break, down sharply from 36% just days ago.
SEC Says It Will Not Wait for Congress to Pass Clarity Act
Despite the Senate delays, some crypto leaders believe the industry will continue moving forward.
Bitwise Chief Investment Officer Matt Hougan said crypto adoption will not stop even if the CLARITY Act is delayed. He expects the SEC to introduce crypto rules that could be even more supportive for the industry.
SEC Chair Paul Atkins recently said the agency is “ready, willing and able” to create crypto regulations without waiting for Congress.
If the Senate fails to act before lawmakers return in September, the CLARITY Act will face an even busier legislative calendar, making its path to becoming law more difficult.
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