The largest crypto bill in the United States is almost certain to miss its deadline. Senate Majority Leader John Thune confirmed that the Clarity Act will likely not pass before Congress enters its summer recess on August 7. “I want to at least get Clarity started. We’ll see where the votes are,” Thune said. The delay deals a blow to the crypto industry, which has treated the legislation as its highest priority following the passage of the GENIUS Act last year.
If passed, the legislation would legalize nearly all digital asset activities and classify crypto as non-securities outside the SEC’s purview. With the August deadline slipping away, the bill is forced to rely on a short legislative window in September. The challenge is steep as politicization ahead of the November midterm elections narrows the room for compromise. However, calendar constraints are not the only roadblock - two hot-button issues are stalling the bill: stablecoin yields and government ethics rules.
The Yield Battle Against Traditional Banks
The stablecoin yield provision has sparked friction between Wall Street executives and lawmakers. JPMorgan CEO Jamie Dimon strongly opposes the clause over concerns that 3-5% APY stablecoin yields could drain customer deposits from traditional banks. Dimon’s stance contrasts with that of Goldman Sachs CEO David Solomon, who has openly supported passing the Clarity Act.
Concerns over an exodus of bank deposits have spilled onto Capitol Hill. Several Republican senators have voiced doubts about the impact of stablecoin yield rules on the banking sector, while also questioning the stringency of ethics provisions for government officials.
Ethics Hurdles and Trump’s Business
On the Democratic side, most lawmakers oppose the draft for very different reasons. They view the ethics provisions as too lenient to restrict Donald Trump’s crypto business operations. A revised version circulated this week with added restrictions on officials, but Democrats argue the updates still fall short of addressing their concerns.
Despite bipartisan pushback, a path for negotiation remains open. Senator Cynthia Lummis believes the most contentious parts can still be amended to secure Democratic support. Lummis’s optimism is shared by White House crypto advisor Patrick Witt. Witt claimed the first week of August remains a viable window for passage, though he conceded that the vote count has not yet reached a safe threshold.
For the crypto industry, the ongoing gridlock delays regulatory certainty that once seemed within reach. Until Washington lawmakers reach an agreement on yield caps and ethics standards, domestic crypto businesses are left funding their operations without clear legal guidelines for the year ahead.
Reported by CoinDesk.
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
