The passage odds for the CLARITY Act have collapsed from 82% to 16%, marking a major setback for the crypto industry. The bill, which was designed to clarify the jurisdictional boundaries between the SEC and CFTC over digital assets, has stalled over disputes regarding ethics provisions related to public officials’ conflicts of interest, as well as disagreements on DeFi governance and stablecoin reward mechanisms. The House passed the legislation in July 2025 with a bipartisan vote of 294-134, but the Senate Banking Committee only achieved a tighter 15-9 vote in May 2026. The SEC has also canceled a meeting scheduled for August 14, 2026, where commissioners were expected to discuss new crypto-specific regulations. With the cloture vote now pushed to September 15, the SEC and CFTC will continue operating under their existing authorities, applying the Howey test and commodity classifications respectively.
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