In this sports season full of Cinderella comeback stories, the crypto industry is also awaiting its own highlight moment—the CLARITY Act advancing in the US Senate could serve as that critical 'comeback.' However, with two quarters left before the final whistle, securing 60 votes will likely require Republicans to reach moral compromises with the White House and bring along several still-hesitant GOP senators.
We are only at halftime. Six months remain in the year, and anything is possible. Legislative victories are no different from scoring on the field—they require precise alignment of multiple factors. Sometimes, burning sage for luck doesn't hurt—just as the New York Knicks showed this year.
CLARITY Act Challenges and Legislative Calendar
The second half of the policy year will be a critical period of intensive negotiations between the two parties in both chambers. Beyond the CLARITY Act, multiple crypto tax proposals split from the new PARITY Act might hitch a ride on larger 'must-pass' legislation before year-end. The core language of the Blockchain Regulatory Certainty Act (BRCA)—can it execute a 'Hail Mary' pass to enshrine developer protections into law? Full-court pressure around the GENUIS rulemaking continues, with key provisions still to be finalized.
The congressional calendar is packed; only about 40 legislative working days remain—even counting the lame-duck session and midterm elections, time for maneuvering and adjusting the score is extremely tight. For crypto enthusiasts, this feels like following an entire sports season: a rich playbook, suspense at every turn.
Crypto Champions Are Retiring
Whatever the final policy outcome, the rest of the year will likely be bittersweet. Two heavyweight 'crypto champions' are about to hang up their federal jerseys: SEC Commissioner Hester M. Peirce and Senator Cynthia Lummis. Peirce, as the lead of the SEC's Crypto Task Force, has been a core architect of cross-regulatory coordination. Lummis chairs the Senate Banking Subcommittee on Digital Assets and is a key bipartisan negotiator and vocal advocate for BRCA. Their departures will have both short-term and long-term repercussions.
Moreover, a financial regulator—the CFTC—operating with only one commissioner (out of five seats) has deeply alarmed the industry. Whether new commissioners can be nominated and confirmed this year remains highly uncertain. Even thornier is the jurisdiction battle over prediction markets: who will win—states, or the CFTC and SEC? Or will it ultimately be decided by the Supreme Court?
Industry Leaders Weigh In: CLARITY, Tax, and Prediction Markets
The author interviewed several seasoned industry leaders. Below are their assessments of the current crypto policy deliberations:
Sara K. Weed (Partner, Gibson, Dunn & Crutcher LLP): 'There is no denying we are steadily moving in the right direction. However, given the shortage of legislative days and election pressures, passage of CLARITY in this Congress is unlikely. Consequently, agencies like the SEC and CFTC will be forced into more proactive roles to provide the industry with much-needed certainty. The question, of course, is how far they can go under their existing authority.'
Sulolit 'Raj' Mukherjee (CEO, Bodin Advisory): 'If history is any guide, meaningful crypto tax legislation is most likely to pass not as a standalone bill but embedded within broader tax, budget, or year-end omnibus packages. Current proposals are relatively focused, bipartisan, and address specific issues like de minimis exemptions, staking tax treatment, wash-sale rules, and information reporting. These provisions advance more easily when attached to must-pass large bills. The chance that at least one or two measures become law this year is real, but likely via packaging rather than as standalone crypto tax legislation.'
Rashan Colbert (Director of US Policy, Crypto Council for Innovation): 'I won't predict how courts resolve the jurisdictional dispute, but the direction is clear: as the prediction market category matures, the CFTC is working to build a more durable regulatory framework. The recent NPRM is another step toward providing more transparency and legal certainty for market participants—a sector where user numbers and trading volumes are growing rapidly. The core question: should prediction markets primarily be treated as financial market infrastructure, or broadly classified as gambling? I believe these markets have the potential to become sophisticated tools for expressing views, hedging risks, and simplifying access to derivatives on various events and assets. An overly broad gambling framework could stifle that potential before the markets can develop into a positive-sum financial infrastructure.'
Outlook for the Second Half
The second half of crypto policy has already begun. The time window is narrow, but the opportunity window remains open. The industry needs sustained cross-party communication and pragmatic pushing to achieve substantive results by 2026.