The U.S. Senate has moved the long-debated crypto market structure bill, known as the Clarity Act, closer to a definitive stage, with a key committee vote scheduled for May 14. Despite this step, policymakers and industry participants do not view the vote as a signal that the legislation will become law in the near term.
The Senate Banking Committee confirmed the timing of the vote late last week, after months of delays tied to disagreements over stablecoin policy, ethics provisions, and regulatory scope. The release of the bill’s 309-page text shortly before the hearing has given lawmakers and stakeholders a clearer view of what remains unresolved.
Jaret Seiberg, managing director at TD Cowen’s Washington Research Group, described the upcoming vote as procedural rather than decisive.
“It is why we see this vote as shifting the fight to the full Senate rather than as an indicator of a deal,” he said in a note on Monday.
He added that time pressure has shaped the strategy, with lawmakers aiming to advance the bill before the August recess.
Stablecoin yield remains central fault line
One of the most contested issues involves whether crypto firms can offer yield on stablecoins. The latest draft restricts interest-like payments tied directly to holding payment stablecoins, which aligns more closely with concerns raised by traditional banks.
Banking groups argue that such rewards could draw deposits away from savings accounts. Over the weekend, the American Bankers Association urged its members to contact senators and oppose what it described as loopholes in the compromise language.
Crypto companies have taken a different position. Coinbase CEO Brian Armstrong addressed the issue during a live event, stating,
“Not everyone got everything they wanted, but they got the must-haves.”
He also noted that the company continues to collaborate with major banks and aims for a cooperative outcome.
A compromise proposal from Senators Thom Tillis and Angela Alsobrooks attempts to limit rewards in certain cases while allowing them in others. However, the divide between financial institutions and crypto firms has not closed, and lawmakers now face a choice between competing priorities.
Ethics provisions create political tension
Another major obstacle involves whether the bill should include rules to prevent government officials from participating in crypto ventures. The current version does not contain such provisions, which has triggered opposition from several Democratic lawmakers.
Senator Elizabeth Warren criticized the omission, stating,
“This bill puts investors, our national security and our entire financial system at risk — and it will turbocharge Donald Trump’s crypto corruption.”
She also claimed that the president and his family have gained at least $1.4 billion from crypto-related activities.
The White House has signaled resistance to any measure that targets specific individuals. Crypto adviser Patrick Witt said policymakers aim to apply rules “across the board, from the president all the way down to the brand new intern on Capitol Hill,” while rejecting provisions that single out particular officeholders.
Senator Kirsten Gillibrand has made clear that Democratic support may depend on the inclusion of conflict-of-interest safeguards. Without them, even lawmakers who support crypto regulation could vote against the bill.
DeFi protections and enforcement powers evolve
The legislation retains protections for decentralized finance developers under provisions linked to the Blockchain Regulatory Certainty Act. These measures aim to ensure that developers who do not control user funds are not treated as money transmitters.
Recent negotiations have addressed concerns from lawmakers focused on national security. Senator Cynthia Lummis confirmed an agreement with Senator Chuck Grassley to clarify the intent required for prosecution under anti-money laundering laws. This adjustment seeks to balance developer protections with enforcement authority.
Thank you @ChuckGrassley for ensuring BRCA/sec 1960 protections for software developers are included in the Clarity Act while giving law enforcement tools they need. Clarity Act is the most pro-law enforcement digital asset bill Congress has ever considered. Let’s get this done!
— Senator Cynthia Lummis (@SenLummis) May 11, 2026
In parallel, lawmakers have discussed expanding tools for prosecutors to pursue crypto-related financial crimes, including money laundering. These additions reflect broader concerns about illicit finance within the digital asset ecosystem.
Path to passage remains uncertain
Even if the Senate Banking Committee approves the Clarity Act, the legislation faces several additional steps before it can become law. It must be merged with a separate version from the Senate Agriculture Committee, followed by negotiations to secure at least 60 votes in the full Senate.
Seiberg emphasized that “major obstacles” remain, particularly on stablecoin policy and ethics rules. He also pointed to unresolved issues such as anti-money laundering standards, the Bank Secrecy Act, and market manipulation oversight.
Political timing adds further complexity. Lawmakers aim to complete work on the bill before the summer recess, while the upcoming midterm elections could shift priorities. Some projections suggest that delays could push final approval into a later congressional cycle, with implementation stretching even further.
For now, the May 14 vote serves as a measure of political momentum rather than a final outcome. The Clarity Act has advanced after months of negotiation, but its future depends on whether lawmakers can resolve the conflicts that have stalled progress for nearly a year.
Kristian Koch
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