The CLARITY Act this week has crossed a major hurdle after President Donald Trump approved new ethics rules tied to the bill. With one of the biggest roadblocks now resolved, lawmakers are racing to finalize the Senate version before the August recess.
Meanwhile, the prediction markets now see a 72% chance of a vote happening on time.
The CLARITY Act has regained momentum after President Donald Trump signed off on new ethics language earlier this week, removing one of the biggest issues that briefly stalled the bill in Congress.
The new proposal would prevent the president, vice president, members of Congress and other federal officials from launching cryptocurrencies while serving in office.
However, lawmakers are still debating who should enforce the rule. Republicans want the U.S. Department of Justice (DOJ) to handle enforcement, while Democrats argue that state attorneys general should also have authority.
Senator Angela Alsobrooks has already warned she will oppose the proposal if the DOJ remains the only enforcement agency.
The White House has responded by saying Democrats would be responsible if the CLARITY Act fails to advance.
Senator Cynthia Lummis says the CLARITY Act is designed to prevent the kinds of losses many crypto users suffered during major company failures, such as Voyager.
The bill would require crypto firms to keep customer assets completely separate from company funds. That means customer holdings cannot be used to repay banks, bondholders, or other creditors if a company becomes insolvent.
According to Lummis, these rules would help prevent investors from waiting years to recover only a small portion of their funds after bankruptcies.
The next major step is the House-Senate reconciliation discussions, scheduled for July 22-24, during which lawmakers will prepare a final Senate draft.
Although the House passed its version of the CLARITY Act in July 2025, the Senate has not yet approved its own version.
Senate Majority Leader John Thune is pushing to bring the updated bill to the Senate floor by late this week or early next week.
Prediction markets Kalshi now place the chances of a Senate vote before the August recess at 72%, showing growing confidence that lawmakers will meet the deadline.
If the Senate approves its version, formal reconciliation with the House is expected during the week of Aug. 3, just days before Congress begins its Aug. 7 summer recess.
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