The U.S. Crypto Clarity Act is at risk of another delay as Congress runs short on time before its August recess. Lawmakers are expected to begin a five-week break on Thursday or Friday, and the bill does not appear to be at the top of the voting list.
Bitcoin Magazine reported that, despite an upbeat tone last week from major crypto companies including Coinbase and support from leading financial institutions, lawmakers seem to be prioritizing other legislation before leaving Washington.
In a Sunday report from Punchbowl News, Democratic Senator Elizabeth Warren said more people in the Senate are starting to question crypto's electoral invincibility. Pro-crypto Republicans have responded sharply. Senator Cynthia Lummis accused Democrats of deliberately slowing the bill after members of the party argued that the current draft falls short.
House passed the bill last year, but the Senate path remains stuck
The Clarity Act passed the House of Representatives last year with bipartisan support, but it has deadlocked this year. The bill is designed to establish a fixed regulatory framework for digital assets in the United States.
A new draft began circulating in July to address ethics concerns. The proposed language would bar government officials and their families from issuing or promoting crypto.
Warren, a long-time crypto critic, has argued that the legislation would allow criminals and cartels to move money and would also enrich President Donald Trump, even though the proposed measure would ban government promotion of crypto.
Banking pressure and Trump conflict questions remain central issues
According to the report, one reason the bill has stalled this year is pressure from the banking lobby over stablecoin yield. Banks argue they could lose their deposit base if crypto exchanges offer customers attractive rewards.
Another issue for some lawmakers is Trump's business exposure to the crypto sector. Critics have alleged conflicts of interest because Trump's family has made money from meme coins and the decentralized finance protocol World Liberty Financial.
Wall Street firms and industry figures still back the current text
Even with the legislative process moving slowly, major Wall Street firms including Fidelity and Goldman Sachs, along with law enforcement organizations, support the bill in its current form.
Kristin Smith, president of the Solana Institution and former CEO of the Blockchain Association, wrote on X on Monday that bipartisan work on the bill is still going on. She said Republican Senator Thom Tillis and Democratic Senator Ruben Gallego are working together on new ethics language for the act.
Coinbase, which has been working with lawmakers on the legislation, also struck an optimistic tone last week. Chief Policy Officer Faryar Shirzad said Democrats and Republicans had worked hard to draft the bill.
The report was first published by Bitcoin Magazine and written by Mathew Di Salvo.