CLARITY Act Odds Sink as Senate Democrats Reject GOP’s ‘Final’ Offer

Betting markets are signaling deep skepticism that Congress will finish the CLARITY Act this year. Odds on Polymarket for the crypto market structure bill passing in 2026 collapsed to 16% on Monday, down from a brief spike to 35% after Republicans floated what they called a final revised proposal — only for Senate Democrats to reject it within days.

The swing captures just how fragile the coalition behind the bill has become. Senators from both parties, including Mark Warner, Raphael Warnock, Ruben Gallego, Elizabeth Warren and Kirsten Gillibrand on the Democratic side and Cynthia Lummis among Republicans, are now at odds over what should have been a late-stage compromise. Republicans need 60 votes to advance the legislation past a filibuster, meaning they cannot pass it without meaningful Democratic support — support that appears to be eroding rather than solidifying.

A Bill Built to Divide Regulatory Turf

The CLARITY Act is meant to settle one of the most consequential open questions in US crypto policy: which federal regulator, the SEC or the CFTC, oversees which parts of the digital asset market. That jurisdictional split has been a source of confusion and litigation risk for years, and resolving it is widely viewed across the industry as a prerequisite for larger institutional participation in US crypto markets.

But the path to a final text has been anything but smooth. As Senate Republicans rewrote the bill ahead of a key cloture vote, disputes over ethics provisions repeatedly resurfaced. Senator Warner said the revisions Republicans offered were insufficient, prompting Democrats to prepare their own counterproposal. Lummis, for her part, said President Trump had already accepted two ethics provisions and that there was nothing more on the table to give — a position that leaves little room for further negotiation on that front.

Those tensions were not new. Days before the vote, concerns had already surfaced over what critics called a loophole tied to the president’s family business interests, and the bill’s momentum had already looked shaky heading into a Tuesday test where votes remained short of what Republicans needed.

Banks and Tribal Gaming Groups Add to the Resistance

The opposition is not limited to Senate Democrats or ethics language. Eight banking trade groups have criticized the bill’s stablecoin provisions, specifically a reward circuit breaker mechanism intended to prevent runs on community banks. According to those groups, the safeguard would only kick in after significant deposit flight had already occurred — effectively acting after the damage is done rather than preventing it. That criticism lands at a moment when smaller banks are already adjusting to a stablecoin landscape reshaped by partnerships such as the one letting community banks offer stablecoins through outside providers rather than building their own infrastructure, as seen in a recent Coinbase-Moov arrangement.

Separately, the Indian Gaming Association has asked for explicit language protecting tribal gaming law from being preempted by federal commodities rules, a concern raised by the bill’s prediction market provisions. That request highlights how a piece of legislation aimed squarely at crypto trading has produced ripple effects in adjacent regulatory territory that lawmakers may not have fully anticipated when drafting the original text.

Eighteen state attorneys general have also come out against the bill, adding another layer of institutional pushback that goes beyond partisan Senate dynamics. Their objections joined a broader call from state AGs urging the Senate to reject the Clarity Act before the vote, underscoring that resistance to the bill spans federal and state levels alike.

What It Means for Crypto Policy

For an industry that has spent years pushing for clearer rules, the stalling of the CLARITY Act is a setback with real consequences. Without the bill, the ambiguity over SEC and CFTC jurisdiction persists, leaving exchanges, token issuers and stablecoin operators to navigate a patchwork of enforcement actions and informal guidance rather than a codified framework. Blockchain Association CEO Summer Mersinger has urged senators to pass the bill regardless, pointing to concessions the industry has already made during negotiations — a signal that crypto advocacy groups view further delay as costlier than accepting an imperfect compromise.

The rewritten proposal has already faced what amounted to a revolt just hours before a scheduled cloture vote, a sign that the coalition assembled around the bill was thinner than it appeared. That volatility is precisely what the Polymarket odds are reflecting: a market pricing in genuine uncertainty rather than a foregone conclusion in either direction.

What to Watch Next

• Whether Senate Democrats formally introduce their counterproposal on ethics provisions, and how Republicans respond.
• Any further movement, or refusal to move, from Lummis and other Republicans on the ethics language Trump has already accepted.
• Whether banking trade groups secure changes to the stablecoin reward circuit breaker before any future vote.
• Whether the Indian Gaming Association’s requested tribal law protections are incorporated into subsequent drafts.
• Further shifts in prediction-market pricing as a real-time gauge of the bill’s prospects heading into any rescheduled vote.

Source: Cointelegraph

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