Galaxy Research recently updated its assessment of the Digital Asset Market Clarity Act, now estimating a mere 10% chance of it becoming law by 2026.
Initially, the CLARITY Act was viewed with optimism, peaking at a 75% probability after the Senate Banking Committee cleared it with a 15-9 vote in May 2026. However, since then, estimates have consistently dropped. By early June, the odds stood at 60%, falling to 50% late in the month, and finally plummeting to 30% after legislative text was released on July 24. The most significant decline occurred in mid-August, where the probability fell dramatically from 30% to just 10%.
The urgency of time is a primary concern. With Congress returning from its August break on September 14, they face limited time—only two to three weeks—to act before the legislative year concludes.
Designated as H.R. 3633, the bill aims to clearly delineate digital assets as commodities or securities, determining oversight by either the CFTC or SEC.
Why is progress stalling?
While calendar constraints play a role, disagreements over specific provisions are a significant factor in the decline of chance for passage. One contentious issue concerns an ethics clause regulating how current and former officials handle crypto assets. The other revolves around whether stablecoins should allow yields for holders, a topic intersecting with the interests of both traditional finance and crypto firms.
Both parties in Congress exhibit reservations, indicating bipartisan resistance. Despite this, over 200 firms advocating for the legislation are organized through the Stand With Crypto coalition, with Senator Cynthia Lummis actively rallying for its advancement.
What does a 10% chance imply for investors?
Investors should keep a close eye on the stablecoin aspect, particularly as a separate stablecoin bill is progressing through Congress. The yield questions tied to the CLARITY Act are also central to this bill. If the CLARITY Act does not advance in this legislative session, it would require reintroduction in the next Congress, essentially restarting a lengthy committee process that was already time-consuming.
Understanding the landscape and timeline of this legislation is vital for crypto investors and stakeholders.