Trump faces new test of the Clarification Act, Senate accelerates key votes

Senate enters final window for passage of the CLARITY bill this year

The Senate may have entered the final practical window for passage of the CLARITY bill this year, with the consolidated draft submitted as early as next week at the earliest, when lawmakers will face tight time pressure before the August recess.

Core Summary

Senate negotiators are preparing a draft consolidated CLARITY bill, which may be voted on by the full house later this month. As lawmakers are still negotiating ethical rules, DeFi protections and stablecoin provisions, support within the Democratic Party is unclear. The White House denies blocking Democratic nominations for the SEC and CFTC, and regulatory appointments have become part of the debate.

According to sources, Senate negotiators are updating the legislative text to merge the crypto market structure bills proposed by the Banking Committee and the Agriculture Committee into a single version. The draft is expected to add more than 70 pages of new content and place greater emphasis on consumer protection measures based on recent negotiated revisions.

The legislative schedule has been highly compressed as the Senate plans to push the bill into full house debate during the week of July 20. Debate on the bill could last for days, leaving lawmakers with a very limited window of time-after which the Senate will enter a summer recess and turn its attention to the fall mid-term election campaign season.

CLARITY Act will establish a federal regulatory framework for digital assets

The CLARITY bill would establish a federal-level regulatory framework for digital asset markets by defining the division of regulatory authority between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).

Although the House passed its version of the bill with bipartisan support in 2025, the Senate is still negotiating key provisions before putting the bill to a vote.

Democratic support remains the biggest obstacle

Despite progress on the draft, the bill still lacks the bipartisan support needed to cross the 60-vote threshold in the Senate. According to people familiar with the matter, as negotiations on a number of outstanding issues continue, the Democratic Party\'s support is uncertain.

One of the biggest controversial points is an ethics clause pushed by Democratic lawmakers. The proposal would prohibit senior government officials, including the president, from holding business interests related to the cryptocurrency industry. Multiple senators have made it clear that if agreement cannot be reached on these restrictive terms, they will not be able to support the final bill.

The controversy over the ethics clause is only part of broader negotiations. Other outstanding issues include concerns from the Senate Agriculture Committee, enforcement requests involving legal protection for decentralized finance (DeFi) developers, and differences over the terms of stablecoin gains.

Another area expected to receive attention is the federal priority clause, which will determine how much regulatory authority states retain after a national crypto regulatory framework takes effect.

Personnel appointments between the SEC and CFTC become the focus of political game

In addition, personnel arrangements for the SEC and CFTC have become part of the political discussions surrounding the bill. The White House refuted allegations that it refused to appoint Democratic commissioners to both agencies.

In a letter to Senate Majority Leader John Thuan and Senate Democratic Leader Chuck Schumer, the White House said it had asked for recommendations for suitable Democratic candidates for the two regulatory agencies, but had not received any nominations so far.

The negotiations eventually continued, and the battle on the eve of the Senate debate

The battle over personnel appointments added new complexity to the negotiations, as if the CLARITY bill became law, the responsibilities of both the SEC and the CFTC would be expanded. Lawmakers are trying to complete legislation before the Senate recess on August 7, and time is running out.

At the same time, the decentralized financial industry is paying close attention to whether the Blockchain Regulation Definiteness Act can be included in a package of bills. This clause will prevent developers who do not control customer assets from being classified as money transfer service providers. Support from Senator Ron Wyden has been seen by industry advocates as a positive development this week.

Although negotiators are expected to release the merged draft soon, sources indicate that the bill is still incomplete. The White House has not yet endorsed the latest version, has not participated in the recent negotiation process, and sufficient votes on the Democratic side have not yet been secured.

Even if the Senate approves the revised bill, the House will still need to pass the updated text before it can be submitted to the White House for the president\'s signature. It can be seen that the CLARITY bill still needs to overcome multiple procedural and political obstacles to eventually become law.