CLARITY bill stalled, Scott criticized Warren team

CLARITY bill stalled ahead of procedural vote, with Scott accusing Warren's team of trying to drive crypto activity out of the United States.

The CLARITY bill stalled on the eve of a September 15 procedural vote that required the support of 60 senators. Senate Banking Committee Chairman Tim Scott accused Elizabeth Warren's team of trying to expel cryptocurrency activity from the United States.

Summary

The Senate will hold a decision on September 15 on whether to begin consideration of H.R. Bill 3633 held a closing debate vote. Scott accused the Warren team of repeatedly changing requirements during the negotiation process. Because advancing the bill requires at least 60 Senate votes, Republicans need the support of Democrats. Provisions related to ethics, stablecoin rewards and financial crimes remain unresolved.

At the SALT meeting held during the Wyoming blockchain seminar, Scott accused Warren and his allies of blocking the Digital Asset Markets Clarity Act in his August 18 appearance. Scott said: "Elizabeth Warren's team wants to get Bitcoin and cryptocurrencies out of the country. The future of finance should be built in the United States."

Responding to ongoing negotiations, the South Carolina Republican also accused Democrats of repeatedly "moving the goalpost" for political reasons. Scott believes the bill will not move forward unless Republican lawmakers apply direct pressure and force the Senate to vote.

His remarks put Warren, the top Democrat on the Banking Committee, at the center of the controversy over the broadest digital asset market structure proposal before Congress. Warren and other Democrats seek to strengthen investor protection, financial crime control, and impose restrictions on crypto businesses linked to elected officials.

Scott's criticism came a day after Democratic Senator Ruben Gallego warned that bringing the bill to the full house too soon could undermine bipartisan negotiations. Gallego, one of two Democrats who supported the Banking Committee's version of the bill, said lawmakers still need to resolve several parts of the proposal before voting.

CLARITY bill faces a 60-vote test in the Senate

Senate Majority Leader John Thune submitted a proposal to begin consideration of H.R. before the Senate recess in August. Motion for closing debate on Bill 3633. The closing debate motion will mature at 2:15 p.m. on September 15, the day after senators resume their normal agenda. Approval of the motion would allow the Senate to formally begin consideration of the legislation, but it does not constitute final passage.

Senators can still debate the proposal, propose amendments and vote on the final text. Any Senate version that differs from the version approved by the House will require further action by the House before being submitted to President Donald Trump.

Supporters need at least 60 votes to break the Senate closing debate threshold. Republicans cannot reach that number alone, leaving Scott still relying on the support of Democrats and independents when criticizing Warren's role in the negotiations.

The House passed its version of the bill by a vote of 294 to 134 in July 2025, with 78 Democrats joining Republicans. In May, the Senate Banking Committee voted 15 - 9 to advance the part of the legislation it is responsible for. Democratic Senators Gallego and Angela Abubrooks supported the committee's measure. Their vote brought bipartisan results for Scott, but fell far short of the Democratic support he needed in the full Senate.

Therefore, the September 15 process will measure whether negotiators have gathered enough support to start the debate. As previously reported, Miller Whitehouse Levin, CEO of the Solana Institute for Policy Studies, put the chance of the bill passing before the November midterm elections at 10%, while the forecast market was slightly optimistic. As of August 19, Polymarket traders put a 20% chance of the bill becoming law in 2026. Whitehouse-Levin's estimate covers passage before the midterm elections, while the Polymarket contract allows lawmakers until December 31.

What changes will the CLARITY bill bring?

H.R. Bill 3633 would divide regulatory authority over digital assets to the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission. Under the proposal, the CFTC would gain primary regulatory authority over the spot market for qualified digital goods. The SEC will continue to regulate securities and certain investment contracts, while both agencies will assume responsibilities related to registration, disclosure and market conduct.

Cryptocurrency exchanges, brokers and dealers subject to the legislation must register under the new federal rules. The bill also contains provisions covering customer asset protection, anti-money laundering requirements and corporate information disclosure on digital assets. Developers of certain unmanaged software are protected if they are considered money transmitters solely for publishing or maintaining the software. Law enforcement groups have previously opposed some of the language, arguing it could restrict investigations involving decentralized finance.

Several organizations later changed their positions after lawmakers revised the relevant provisions. The National Brotherhood of Police, which represents more than 382,000 members, backed the updated language in July, arguing that it retained authority used in digital asset investigations. Another coalition of police chiefs also supported the revised proposal, while other prosecutors and law enforcement groups continued to seek changes. The disagreement makes the developer clause one of several issues senators must address before seeking enough full house votes.

Lawmakers released a 616-page merger draft at the end of July that consolidates the work done by the Banking and Agriculture Committees. The two committees oversee different parts of the proposed regulatory structure because the SEC falls under the jurisdiction of the Banking Committee and the CFTC falls under the jurisdiction of the Agriculture Committee.

Issues of ethics and stablecoin rewards divide negotiators

Restrictions involving elected officials and their encryption interests remain one of the most difficult issues for senators to resolve. Democrats seek rules for digital asset businesses linked to presidents, senior officials and their families. Their concerns include the Trump-related crypto business and whether a sitting president should be allowed to issue, promote or profit from digital assets while influencing federal policy.

Republican Senator Tom Tillis has been working on a bipartisan ethics bill that aims to address some objections. Industry executives also pointed out that negotiations with the White House could be the path to a deal, but as of August 20, lawmakers had not yet announced a final compromise. Stable coin rewards create another divergence. Banks have pushed to restrict crypto platforms from paying earnings or rewards for stablecoins, warning that such products could siphon deposits from regulated financial institutions.

Crypto companies believe that broad restrictions could limit competition and go beyond the scope of rules Congress has set for stablecoin issuers. Negotiators have not publicly confirmed the final wording that meets both parties 'demands. Financial crime control and how to deal with decentralized protocols are also still under discussion. Democrats from Warren and his allies pressed for stronger measures to cover illicit finance and national security issues, while crypto advocates warned against applying obligations on financial intermediaries to software developers who do not control customer funds.

A July report on Senate vote delays found that even after major law enforcement groups supported the revised terms, controversy over ethics, DeFi protection and stablecoin rewards persisted.

Scott's criticism meets Democratic resistance

Scott described the controversy in Wyoming as a choice between passing federal rules or allowing crypto companies to leave the United States. His criticism of Warren's team was more severe than previous Republican rhetoric calling for bipartisanship. Warren believes that digital asset legislation must include adequate consumer protections and prevent public officials from using their positions for personal financial gain. Democrats allied with her also question whether current enforcement provisions are sufficient to cover money laundering and national security risks.

Not all Democrats who oppose an immediate vote reject market structure legislation. According to a recent report, Gallego said on August 19 that rushing forward could weaken the chances of reaching a bipartisan agreement. Gallego also said the White House had not provided detailed feedback on the bipartisan ethics language sent by Senate negotiators. In addition to the ethical controversy, he also pointed to stablecoin rewards and unresolved agricultural committee clauses as issues that need to be further addressed before legislation can be advanced.