Summary
- Action on the US Senate's digital-asset market-structure bill, the CLARITY Act, has stalled over three issues raised by Democrats: ethics provisions, anti-money laundering (AML) and bill language from the Senate Agriculture Committee.
- Democrats cited concerns over President Donald Trump's digital-asset conflicts of interest, including safeguards related to his memecoin and World Liberty Financial (WLF), as well as risks that decentralized finance (DeFi) exemptions could hamper efforts to fight financial crime.
- TD Cowen said the CLARITY Act may be short by as many as 10 votes needed to reach the 60-vote threshold in the Senate, and that both delaying the recess and using unanimous consent to speed the process are unlikely, though Democrats said passage in September remains possible if the issues are resolved.
Forecast Trend Report by Period
The US Senate's effort to advance the CLARITY Act, a market-structure bill for digital assets, has reached a standstill as Democrats insist three issues be resolved before the measure can move forward: ethics provisions, anti-money laundering rules and bill language tied to the Senate Agriculture Committee.
The Block reported on Aug. 5 that Senate Majority Leader John Thune had yet to file for cloture to bring the CLARITY Act to the floor. The Senate is scheduled to begin a monthlong summer recess on Aug. 8, narrowing the window for a procedural vote this week. Thune still intends to push ahead with that vote, the report said.
A Senate Democratic aide quoted by The Block described the talks as a "standstill." Democrats want movement on three core issues before backing the bill: ethics provisions, protections against illicit finance and language from legislation prepared by the Senate Agriculture Committee.
The biggest dispute centers on President Donald Trump's potential conflicts of interest in crypto. Democrats are calling for stronger safeguards tied to Trump's digital-asset businesses, including his memecoin and World Liberty Financial, or WLF.
They also argue the bill does not go far enough on anti-money laundering and consumer protection. Some law-enforcement agencies are concerned the CLARITY Act's broad exemptions for decentralized finance, or DeFi, could make it harder to combat financial crime.
Negotiations are also continuing over how language drafted by the Senate Agriculture Committee should be incorporated into the final bill.
TD Cowen said the Senate may still be as many as 10 votes short of the 60 needed to pass the CLARITY Act. The firm also said moving the bill this week would require either delaying the Senate's recess or speeding up procedure through unanimous consent, but viewed both scenarios as unlikely.
Still, the Democratic aide said the CLARITY Act would not be dead in August and could still pass in September if the outstanding issues are resolved.
Suehyeon Lee
shlee@bloomingbit.ioI'm reporter Suehyeon Lee, your Web3 Moderator.