Key Takeaways
The price of XRP dropped 2.4% on Tuesday after the Senate Banking Committee’s planned markup of the CLARITY Act was delayed until at least May, sinking the odds of the landmark crypto legislation passing this year.
"Further delay is unacceptable," Senator Cynthia Lummis (R-WY) said, pushing back against the delay and warning that the risk of crypto innovation moving offshore is real.
The delay was prompted by Senator Thom Tillis (R-NC), who is seeking more time to hear from banking stakeholders opposed to the bill's stablecoin yield provisions. The legislative uncertainty has seen prediction market Polymarket drop the odds of the CLARITY Act passing in 2026 to 46%, down from a high of 82% in February. More than 270 days have passed since the House initially passed the bill.
The stalemate highlights the growing friction between the crypto industry and legacy finance over the future of US digital asset regulation. Failure to pass the bill before the midterm elections could leave the market in a state of regulatory uncertainty, potentially stifling institutional investment and pushing development to other jurisdictions.
The CLARITY Act, which would establish a comprehensive regulatory framework for digital assets in the US, has been stuck in the Senate Banking Committee amid a coordinated pressure campaign from bank lobbying groups. These groups object to provisions that would allow stablecoin holders to earn interest, a feature they fear would compete with traditional bank deposits. Ohio Senator Bernie Moreno has called the banks' objections "fake," urging them to "get going with innovation."
In response to the delays, the Blockchain Association and the Crypto Council for Innovation, backed by more than 100 other entities, sent a letter to committee leadership urging them to proceed with a markup. "The United States cannot risk a return to the previous era of regulation by enforcement, which perpetuated uncertainty for both builders and market participants," the letter stated.
While Congress struggles to advance the broader market structure bill, the Office of the Comptroller of the Currency (OCC) is moving forward on a parallel track. The agency is advancing its own rules to implement the GENIUS Act, which would create a federal framework for licensing and supervising payment stablecoin issuers. The public comment period for the OCC's proposed rule closes on May 1.
This article is for informational purposes only and does not constitute investment advice.
