Clarity Act: Will the Senate Pass Crypto’s Landmark Framework in 2026?

The CLARITY Act, a bill first introduced in May 2025, quickly made its way through the House, and now, it is likely to move more slowly and face more opposition in the Senate.

With mid‑term elections approaching, both parties have incentives to finalise legislation before campaign season intensifies, yet political dynamics could either accelerate passage or push it into 2027.

Legislative Timeline

Market data from CoinShares shows nearly $1 billion in outflows during the delay, suggesting investors are sensitive to regulatory clarity.

Players in the ecosystem, regulators, and investors have been keeping a keen eye on this attempt to legislate digital assets, which could determine how the authorities will deal with crypto and asset regulation going forward, as well as issues such as DeFi.

Also Read: Polymarket Bets Spike 77% as US Shutdown Fears Stall CLARITY Act Progress

Contentious Issues

Banks are concerned that yield bearing stablecoins have the potential to draw away deposit holders and thus pose a threat to the overall financial stability. The House gave its approval to the CLARITY Act on the 17th of July, 2025, by 294 to 134 votes.

A large part of the Republican Party and a small section of the Democrats voted for it. Soon after, Senate Banking Committee Chairman Tim Scott put out a revised text in July with the target date of September 30 for completion.

Also Read: Bitcoin’s (BTC) Massive $150K Reality Check: Anthony Scaramucci Blames Clarity Act

Outlook

The Democrats are demanding that ethics provisions and a bailout ban be included, but the Republicans are not willing to accept it. The crypto industry, led by Coinbase, is against the language that would completely outlaw interest bearing stablecoins and make the SEC the primary regulator.

Also Read: Coinbase Pulls Support for Digital Asset Market Clarity Act