Key facts
- Galaxy Research has reduced the probability of the CLARITY Act becoming law this year to 10%.
- The Senate delayed a vote on the bill due to ongoing political and industry disputes.
- Unresolved issues include government ethics controls, stablecoin business models, and developer protections.
- The SEC is reportedly preparing crypto exemptions, including Reg Crypto and the Innovation Exemption.
- The CFTC is actively pursuing regulatory measures concerning prediction markets.
Galaxy Research has significantly lowered its odds for the CLARITY Act's passage into law this year to just 10%, citing a confluence of unresolved political and industry disputes. The Senate's schedule also presents a narrow window for the legislation, with lawmakers not expected to reconvene until September 14 and planning to adjourn again around October 2 for midterm election activities.
Key obstacles identified by Galaxy include ongoing debates over ethics controls for government officials involved with crypto, pressure from community banks regarding stablecoin business models, and discussions around protections for crypto software developers. These issues have complicated efforts to secure the necessary bipartisan support.
As legislative progress stalls, U.S. regulators like the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are advancing their own crypto policy initiatives. The SEC is reportedly preparing major exemptions, such as Reg Crypto for public asset issuance and an Innovation Exemption for secondary trading of tokenized securities in DeFi. The CFTC, meanwhile, is increasing its focus on prediction markets and event contracts. These agency-led measures could offer temporary regulatory clarity but lack the permanence of congressional legislation and may be subject to change under a different administration.