Galaxy Research lowered its estimate for the CLARITY Act becoming law in 2026 to 30% after the Senate released combined legislative text. The revised outlook came from Galaxy Research Head of Firmwide Research Alex Thorn after lawmakers published the 616-page bill. Thorn previously estimated the bill had a 50% chance of becoming law, but the firm reduced its outlook as negotiations became more difficult and the Senate calendar tightened. Supporters face a difficult vote calculation as lawmakers seek the 60 votes required to overcome a Senate filibuster.
Senate Releases 616-Page CLARITY Act Text
Lawmakers published the 616-page bill, which combines proposals from the Senate Agriculture Committee and Senate Banking Committee with new provisions covering ethics, enforcement, stablecoins, and custody rules. The CLARITY Act contains 104 numbered sections across four divisions and preserves several industry priorities, including developer protections, self-custody safeguards, and rules for digital asset intermediaries. The bill also creates new enforcement tools targeting crypto-related fraud, including elder scams and "pig-butchering" operations, while establishing requirements for qualified digital asset custodians.
Thorn detailed in a July 24 article on X: "We are lowering our estimate of the probability that CLARITY becomes law in 2026 to 30%."
Lawmakers Face 60-Vote Threshold Challenge
The vote calculation has become the central challenge for supporters, with lawmakers needing bipartisan backing to move the legislation through the Senate. Thorn highlighted the challenge facing supporters: "The bill may not even have a clear majority-party majority in hand, much less the 60 votes required to overcome a filibuster."
The CLARITY Act would establish federal rules for digital asset classifications, exchange oversight, custody requirements, and regulatory responsibilities between the U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).
Democratic Senators Oppose Ethics Provisions
The latest CLARITY Act draft introduced a new ethics division restricting certain senior government officials and their spouses from issuing or sponsoring digital assets while serving in office. The proposal establishes disclosure requirements and assigns enforcement authority to the Department of Justice (DOJ).
Seven Democrats, including Senators Mark Warner, Angela Alsobrooks, Cory Booker, Catherine Cortez Masto, Ruben Gallego, John Hickenlooper, and Raphael Warnock, said the current text fell short. Democratic lawmakers involved in negotiations pushed for stronger ethics rules, consumer protections, illicit finance safeguards, and market integrity provisions. U.S. Senator Elizabeth Warren (D-MA) separately criticized the draft, calling for stronger measures to prevent financial crime.
The provision has drawn criticism from lawmakers who want stronger safeguards around conflicts of interest and financial crime. The dispute has added another challenge for negotiators attempting to build support for the legislation before the Senate's August recess.
August Recess Deadline Approaches for Crypto Bill
With the Senate approaching its August recess, the remaining legislative window has become a key factor in the bill's outlook. Crypto businesses and voters continue watching whether lawmakers can resolve disagreements and advance the legislation before election-year priorities reshape the congressional schedule.
The framework has drawn attention from crypto companies and investors seeking clearer rules for operating in the United States. The debate follows a longer effort to create federal crypto market rules, with lawmakers previously struggling to finalize a framework. The ethics provisions remain one of the biggest points of disagreement, with lawmakers debating government accountability, oversight standards, and financial crime protections.
FAQ
Why did Galaxy Research lower CLARITY Act passage odds to 30%?
Galaxy Research reduced its estimate from 50% to 30% after the Senate released the 616-page combined legislative text. The firm cited increased negotiation obstacles and a tightened Senate calendar as reasons for the revised outlook.
What vote threshold does the CLARITY Act need to pass the Senate?
The CLARITY Act requires 60 votes to overcome a Senate filibuster. Supporters face challenges in securing bipartisan backing, with the bill potentially lacking even a clear majority-party majority according to Galaxy Research Head of Firmwide Research Alex Thorn.
Which Democratic senators oppose the current CLARITY Act text?
Seven Democratic senators—Mark Warner, Angela Alsobrooks, Cory Booker, Catherine Cortez Masto, Ruben Gallego, John Hickenlooper, and Raphael Warnock—said the current text fell short. Senator Elizabeth Warren (D-MA) separately criticized the draft, calling for stronger measures to prevent financial crime.
