CLARITY Act Chances Plummet to 10% Amid Time Constraints and Disagreements

The prospects of the Digital Asset Market Clarity Act (CLARITY Act) passing this year have taken a significant hit, according to Galaxy Research. The firm initially gave the bill a coin-flip's chance of becoming law in 2026, but now puts its chances at just 10%. This sharp decline is largely attributed to time constraints, with the Senate returning from recess on September 14 and having only two to three weeks of usable floor time before the legislative calendar effectively closes for the year.

The CLARITY Act aims to clearly distinguish between digital assets that qualify as commodities and those that qualify as securities. This distinction would hand primary oversight to either the CFTC or SEC, depending on which category an asset falls into. However, two specific provisions have proven difficult to resolve across party lines: an ethics clause for government officials' crypto holdings and the question of whether stablecoins should offer yield to holders.

Calendar pressure is only part of the problem. Galaxy Research also points out that persistent disagreements over these two issues have led to a significant downgrade in the bill's chances. The disagreement isn't cleanly partisan, with both Republican and Democratic members raising objections. Senator Cynthia Lummis has continued to push for the legislation, but her efforts may not be enough to overcome these obstacles.

The CLARITY Act is closely tied to another stablecoin-specific bill moving through Congress. If it doesn't pass this session, the bill would need to be reintroduced in the next Congress, restarting a committee process that took nearly a year to complete.