The CLARITY Act's legislative journey has become significantly more complex than initially anticipated, with TD Cowen's Washington Research Group now placing passage odds at just 30% for 2026. According to TD Cowen, the fight extends beyond stablecoin-yield language to include CFTC staffing issues, prediction-market disputes, World Liberty Financial scrutiny, Iran-related crypto concerns and possible competition from the Credit Card Competition Act. More than 270 days have passed since the House vote, weakening Washington's ability to set clear rules for trading venues, token issuers and decentralized software developers. The Senate Banking Committee progress has slowed as lawmakers debate regulatory authority, software developer liability and how much power should shift to the Commodity Futures Trading Commission.
Pro-Clarity Act crypto lobbyists have redoubled their efforts to get the bill over the line in the weeks ahead, with the Blockchain Association and Crypto Council for Innovation urging Senate Banking Committee members to approve the legislation "as soon as practicable" in an open letter. As reported by DL News, Lindsay Fraser, Chief Policy Officer at the Blockchain Association, stated "We hope this letter helps move market structure legislation from discussion to action in the Senate Banking Committee, with a clear path to markup." Crypto industry insiders this week gave the bill a 50-50 chance of passing before the year is out, while Polymarket users are even more pessimistic, backing the bill at just 45% to pass this year, with chances sliding 19% on Wednesday. Alex Thorn, head of research at Galaxy Digital, warned that any further delays "contract the timeline and marginally reduce the likelihood of eventual passage in 2026," adding that "Every week of delay compresses the window for the sequential steps required to reach the President's desk."
As reported by crypto.news, Polymarket traders are pricing the bill's passage at approximately 43%, down from 82% earlier in the year, reflecting the compounding delays and calendar pressure. The prediction market on the CLARITY Act has generated over $557,000 in trading volume since January. Yuliya Barabash, founder and managing partner at SBSB Fintech Lawyers, told DL News that "Lobbyists think a Senate committee hearing in May could keep the legislation viable, provided it manages to pass a final vote of the full Senate by July." Senator Thom Tillis reportedly backed a postponement until May, adding that negotiators need more time to find a compromise between banks and crypto firms. Experts have previously warned that if the bill doesn't hit the Senate floor by May, its chances of passing this year could vanish completely.
For the CLARITY Act to become law in 2026, five sequential steps must succeed in rapid succession: a Senate Banking Committee markup, a 60-vote Senate floor threshold, reconciliation of the Banking and Agriculture Committee versions, reconciliation with the House-passed text from July 2025, and a presidential signature. Each of these steps represents a potential point of failure. The House passed the Digital Asset Market Clarity Act by 294-134 on July 17, 2025, giving the crypto industry its strongest market-structure win to date. The White House has described the stablecoin yield compromise as holding firm, with White House crypto adviser Patrick Witt stating the deal is a "must-have" for unlocking the remaining issues. JPMorgan analysts have publicly described CLARITY Act passage by midyear as a positive catalyst for digital assets, reflecting how much institutional deployment in crypto is currently gated behind regulatory clarity. Coinbase CEO Brian Armstrong reversed his company's earlier opposition and backed the current bill version in April. Approximately 65% of institutional investors surveyed by Coinbase and EY-Parthenon have cited regulatory clarity as the condition holding them back from serious XRP and broader digital asset deployment.
TD Cowen identified CFTC understaffing as a central practical problem because the agency would be expected to take on expanded digital-asset oversight if the bill advances. The regulatory complexity has also raised concerns about insider trading, event-contract boundaries and political conflicts as the same regulatory category that has brought Kalshi, Polymarket and other platforms into the political spotlight now sits close to broader digital-asset negotiations. TD Cowen also talked about the political sensitivity around World Liberty Financial, the Trump family-linked crypto venture, as a potential source of Democratic resistance. The firm added that Iran-related crypto concerns could invite anti-money-laundering amendments, while the Credit Card Competition Act could become an unrelated rider that makes the package harder to pass. Elisenda Fabrega, general counsel at Brickken, warned that "If the bill does not pass this year, the next phase will likely be a combination of narrower interim measures, continued agency enforcement, court-driven precedent, and renewed legislative attempts after the midterms."
