US Senate Clarity Bill Stalls as Passage Probability Drops to 16%

The expected passage of the US Senate's Clarity Act, which aims to establish a regulatory framework for the cryptocurrency market, has once again diminished. According to blockchain media CoinTelegraph on Thursday (local time), the likelihood of the bill being enacted by year-end has dropped to 16%, as reported by Polymarket.

The prospect had previously risen to 35% after a Republican amendment strengthening ethics provisions was introduced, but further Democratic opposition caused a retreat. Senator Mark Warner, who participated in negotiations, stated that the revised ethics clause is insufficient, while Democrats prepared a counter-proposal and delivered it to the Republican negotiating team on Thursday.

The Republicans need 60 votes in the Senate to advance the bill. If procedural voting scheduled for Friday fails, legislation determining how the SEC and CFTC divide oversight of the crypto market could stall as well.

Democratic concerns center on the effectiveness of ethics regulations. Senator Raphael Warnock stated that advancing a bill that does not address real-time corruption risks should be avoided, while Senator Ruben Gallego expressed strong dissatisfaction with recent ethics proposals and announced plans to prepare an alternative counter-proposal. Senator Elizabeth Warren's team shared internal arguments suggesting that state attorneys general enforcement powers could be overturned by the White House Office of Ethics.

Not all Democrats oppose the bill. Senator Kirsten Gillibrand privately requested support from colleagues for procedural voting, while Senator Sinema Lumis argued that President Donald Trump has already accepted two key ethics provisions and there is nothing more to negotiate with Democrats.

Opposition also extends beyond Democrats. An alliance of 18 state attorneys general had already opposed the bill, followed by the National Indian Gaming Association requesting members to vote against it due to insufficient changes to decentralized finance provisions. The association argued that the proposed amendments fail to address concerns about prediction markets and demanded language specifying that federal commodity law should not override tribal or state gaming laws.

The banking sector also criticized the amendment, stating it fails to close loopholes in stablecoin rewards. Eight banking industry groups claimed that reward structures operating like deposit interest remain intact, with circuit breakers designed to activate only after significant deposit outflows at regional banks.

Crypto industry representatives urged passage of the bill. Blockchain Association CEO Summer Mersing stated that the industry has made substantial concessions to secure bipartisan support, emphasizing that the legislation would create clear rules, protect consumers, deter illegal activity, and prevent crypto-related job and developer talent from moving overseas.