Galaxy Digital has lowered its forecast for the CLARITY Act: the chances of passage are only 10%.
Galaxy Digital analysts have revised their forecast regarding the fate of the CLARITY Act in the U.S. Senate, lowering the probability of its approval to 10% in 2026. This sharp drop in confidence reflects deep disagreements that remain unresolved around key provisions of the bill, affecting both ethical standards for public officials and mechanisms for distributing yield from stablecoins.
In my view, the main issue here is not technical details, but the political climate. A bill that was supposed to be a breakthrough in digital asset regulation has turned into a battleground between various factions, significantly reducing its chances of passing through the Senate in its current form.
Timeframes are shrinking
Time is becoming a critical factor. After lawmakers return from recess on September 14, they will have only two to three weeks before the campaign season tied to the midterm elections begins. This compressed schedule makes full discussion and voting on such a complex and controversial bill practically impossible.
Particular concern is raised by the provisions on stablecoin yield. The question of who and how will distribute the interest generated by reserves remains a stumbling block. Without clear consensus on this point, as well as on ethical rules for officials, the bill is unlikely to receive the necessary number of votes.
Midterm elections traditionally paralyze legislative activity in Washington, and the crypto industry, it seems, will have to wait for the next convocation of Congress to resume attempts at passing comprehensive regulation.
My verdict: The chances of passing the CLARITY Act this year are melting away before our eyes. Even if the bill is brought to a vote, its fate looks predetermined. Investors and market participants should prepare for a prolonged period of uncertainty in stablecoin regulation, which could increase market volatility.