Crypto Bill Hits Another Roadblock
The CLARITY Act suffered another setback Tuesday after Senate negotiations between Republicans and Democrats failed to produce a compromise, with a crucial procedural vote approaching within hours.
Republicans turned down the Democrats’ latest counterproposal, leaving the two parties still sharply divided over the crypto market structure legislation.
Sen. Cynthia Lummis (R-Wyo.), one of the Republicans negotiating the bill, said the Democratic proposal did not represent meaningful movement from the positions lawmakers held before the August recess.
Lummis said in a statement shared with CoinDesk that Democrats had essentially repeated their opening demands. She said Republicans had made significant concessions across the negotiations, including agreeing to nearly all of the Tillis-Gallego ethics framework, while Democrats had not made comparable concessions.
She called on Democrats to engage in substantive negotiations rather than resubmit existing demands and characterize them as progress.
Prediction Markets Turn Bearish
The breakdown in talks caused a sharp decline in expectations across prediction markets.
On Polymarket, traders placed the odds of the CLARITY Act becoming law in 2026 at only 14% Tuesday morning. The probability had been around 30% roughly one day earlier.
Kalshi traders also became less confident about a near-term deal. The probability of a crypto market structure bill becoming law before Oct. 1, 2027, fell to 36% Tuesday from approximately 53% on Monday morning.
The market’s timeline for eventual passage also moved back. On Monday, traders gave the bill a 53% chance of becoming law before July 1, 2027. By Tuesday, Kalshi showed a 51% probability that the CLARITY Act or another qualifying crypto market structure bill would pass by Jan. 1, 2028.
Concessions Fail to Break Deadlock
The latest setback reverses the optimism seen Monday, when prediction-market odds climbed on expectations that concessions from Republicans could finally resolve the months-long stalemate.
The momentum faded after banking organizations called for tougher restrictions governing stablecoin interest and rewards. A bipartisan group of state attorneys general also warned that the proposed legislation could limit states’ ability to investigate and address crypto-related fraud.
Republicans released what they described as their final draft over the weekend after incorporating more than 100 changes requested by Democrats. Among those revisions were concessions concerning ethics provisions.
The Senate is scheduled to hold a procedural vote Tuesday afternoon on whether to invoke cloture on the motion to proceed. The measure requires 60 votes, putting bipartisan backing at the center of the bill’s immediate prospects.
