U.S. Treasury Secretary Scott Bessent said in a CNBC interview on February 14 that moving the CLARITY Act forward quickly would bring "enormous confidence" to the market during a prolonged downturn. He also warned that if Democrats win back the House in the 2026 midterm elections, the outlook for crypto legislation could "completely fall apart".
Bessent said opposition from crypto industry executives has slowed the bill and hurt the broader sector. His argument was blunt: in a period he described as a historic sell-off, the market needs a clearer regulatory direction, and the CLARITY Act could help provide it.
House passed the bill, Senate deadlock centers on stablecoin yield
The Digital Asset Market Clarity Act is designed to define the jurisdictional boundary between the SEC and the CFTC over digital assets. The bill passed the House in July 2025 by a 294-134 vote, but stalled in the Senate over one key issue: whether stablecoins should be allowed to offer yield to holders.
Large banks, including JPMorgan, Goldman Sachs, and Citi, support a full ban on interest-bearing stablecoins, citing concerns that trillions of dollars in deposits could move out of the banking system. Crypto companies take the opposite view. They argue that yield is a core part of onchain finance, and banning it would cut off a major area of product development. The White House brought both sides together for talks on February 10. The meeting produced some progress, but no agreement.
Bessent had already escalated his criticism earlier this month
Bessent has used unusually sharp language against those resisting the legislation. Earlier in February, he publicly described crypto figures opposing the bill as “nihilists,” singled out Coinbase as a “recalcitrant actor,” and said people who believe the CLARITY Act is unnecessary “should move to El Salvador.” Those remarks made clear that the dispute is no longer limited to technical drafting questions and now reflects a deeper split inside the industry.
Narrow House majority leaves little room for delay
Bessent said the bill needs to advance quickly and reach President Trump for signature before the U.S. spring window, defined in the source material as late March through late June. His warning was direct: a Democratic takeover of the House would wipe out the chances of a deal.
Republicans currently hold the House by a narrow 218 to 214 margin, with 3 seats vacant. At the same time, 51 House members have already announced they will not seek reelection, including 30 Republicans and 21 Democrats. The source also notes that Trump’s approval rating is hovering around 40%. On prediction market Polymarket, 47% of traders are betting on a split Congress in 2026, with each party controlling one chamber. If that outcome materializes, pressure would extend beyond the CLARITY Act to the broader slate of crypto-friendly legislation.