Revised CLARITY Act Draft Due Next Week as Ethics Dispute Persists

The CLARITY Act seeks to create the first comprehensive US market structure for digital assets, defining when tokens should be treated as securities or commodities and dividing oversight between the Securities and Exchange Commission and Commodity Futures Trading Commission. Its significance extends beyond jurisdictional lines: negotiations over stablecoins and decentralized finance could determine whether Congress can deliver durable rules for an industry still operating under fragmented enforcement and guidance.

The Senate majority leader has moved to initiate a procedural vote, positioning the bill for a possible full-chamber vote as early as mid-September. The White House has pledged to push CLARITY across the “finish line” in September, but resistance is mounting. Senator Ruben Gallego has urged colleagues not to rush the measure, Galaxy cut its estimated odds of passage to 10%, and the CFTC and SEC are exploring joint regulatory steps should Congress fail to act.

The CLARITY Act aims to clarify how oversight of crypto assets is divided between the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission. The dispute centers on whether the Blockchain Regulatory Certainty Act, or BRCA, should exempt DeFi developers who do not control user assets, determining whether software developers must assume the responsibilities of financial intermediaries.

As of July 19, 2026, bipartisan Senate negotiations had broken down over an amendment providing a BRCA enforcement exemption, despite claims that lawmakers had reached 99% agreement. The legislative window is only about eight weeks. The White House will hold talks with law enforcement groups, but no compromise has emerged on the key provision. The bill could move to separate votes by the two parties, making it unlikely to clear the Senate threshold.

The U.S. CLARITY Act seeks to establish a digital-asset market framework and delineate the responsibilities of the SEC and CFTC, making it pivotal to securing federal regulatory certainty for the crypto industry. Gnosis co-founder Friederike Ernst warned that forcing transactions through intermediaries such as banks or exchanges could erode users’ ability to hold and trade assets independently.

Coinbase withdrew its support on January 14, 2026, citing provisions that restrict DeFi, tokenized equities and the distribution of stablecoin yields. The Senate Banking Committee postponed its review the following day. BitMart later warned that more than 100 amendments could stifle DeFi, while the industry fears that failure to pass the bill before May 2026 could lead to a prolonged delay because of the midterm elections.