Clarity Act Revamp Sends Warning Signs to Crypto Traders
A surprise move on the Clarity Act could be on the horizon for crypto markets. According to Bernstein analysts, the market has not priced in a positive outcome for the bill, which would establish federal rules for digital assets and clarify the responsibilities of regulatory bodies.
The latest draft of the bill, released Sunday, incorporates 126 changes requested by Democrats, including a role for state attorneys general in enforcing ethics restrictions. This change, alongside divestment or blind-trust requirements, could persuade some Democrats to support advancing the legislation.
However, not all analysts are convinced that the bill will pass. TD Cowen analyst Jaret Seiberg maintains a 25% probability of enactment this year, while Beacon Policy Advisors has raised its estimate to 30%-40%. CFTC Chair Michael S. Selig has also weighed in, saying that if Congress fails to pass the Clarity Act, the CFTC will pursue crypto rules using powers it already has.
The changes come after a September 10 draft that left ethics provisions largely unchanged while adding registration requirements for crypto trading protocols controlled by people or groups. President Donald Trump has agreed to the revised restrictions, and Sen. Cynthia Lummis (R., Wyo.) is urging Democrats to back the bill, saying 'Democrats got what they wanted; now they need to take yes for an answer.'