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Galaxy lowers CLARITY Act odds to 10%
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Galaxy Digital has dramatically reduced the likelihood of the Digital Asset Market Clarity (CLARITY) Act becoming law in 2026, slashing its odds to just 10%. The firm cited unresolved political conflicts and a painfully narrow legislative window when the Senate returns from recess in September. This marks a steep decline from Galaxy’s earlier projections, which stood at 75% in late May and had already been trimmed twice before this latest revision.
The CLARITY Act aims to establish the first comprehensive regulatory framework for digital assets in the United States, a long-sought goal for the crypto industry. However, the bill has faced significant opposition from Democrats and the banking sector, which argue it would allow crypto firms to offer stablecoin yields without adhering to the same consumer protections required of traditional banks. These tensions have left multiple issues unresolved, including ethics rules for government officials involved in crypto and pressure from banks over stablecoin yield provisions.
According to Alex Thorn, Galaxy’s head of firmwide research, the Senate will have only about two to three weeks to pass the bill when it reconvenes on September 14. Thorn warned in a Friday post on X that unless an initial motion to proceed vote occurs immediately upon lawmakers’ return, the CLARITY Act would only pass if it “dominates basically the entire working session.” This tight timeline makes passage highly unlikely without immediate and forceful action.
The technical sticking points are substantial. The bill cleared the Senate Banking Committee in May, but most Democrats and banking groups have pushed back, claiming it creates an uneven playing field. Additionally, developers have raised concerns about insufficient legal protections, and stablecoin yield provisions remain a major flashpoint. These unresolved details would require intense negotiation, leaving little room for the expedited process needed before the session ends.
The impact of this lowered probability is significant for crypto companies, investors, and policymakers who viewed the CLARITY Act as a critical step toward regulatory clarity in the United States. More than 200 crypto firms and organizations urged the Senate to pass the bill in a letter shared by the lobby group Stand With Crypto at the beginning of June. A failure to advance would likely prolong the current patchwork of state-level regulations and keep many firms operating in legal uncertainty.
Industry reaction has been a mix of disappointment and realism. While crypto advocates continue to push for the bill, analysts like Thorn acknowledge the political headwinds. The banking industry, meanwhile, has welcomed the slowdown, arguing that the current proposal would unfairly advantage non-bank entities. Public sentiment among crypto supporters remains hopeful, but the clock is ticking.
Looking ahead, the bill’s fate hinges on whether Senate leadership prioritizes it immediately upon return. Without a swift procedural vote, the CLARITY Act is all but dead for 2026. If it fails, proponents may have to wait for a new Congress or seek piecemeal regulatory changes through agencies like the SEC or CFTC.
This development fits into a broader trend of uneven crypto regulation globally, with the U.S. struggling to keep pace with jurisdictions like the EU and Singapore. It also coincides with major stablecoin initiatives, such as Meta’s reported 2026 push, which could be affected by the lack of clear federal rules. The coming weeks will determine whether the CLARITY Act becomes a footnote or a catalyst for future legislative efforts.
