- Last-minute disputes over DeFi rules cast uncertainty over the CLARITY Act committee vote.
- Cynthia Lummis warned Congress cannot wait for another crypto collapse before regulating markets.
- More than 100 amendments and bipartisan tensions complicated the CLARITY Act’s path forward.
Lawmakers on Capitol Hill are prepared to vote Thursday on the crypto-focused CLARITY Act, a proposal that could shape digital asset regulation in the United States. The Senate Banking Committee markup came as crypto firms, lobbyists, and industry groups closely monitored negotiations amid signs that bipartisan support had weakened.
Cynthia Lummis remained optimistic ahead of the hearing. Speaking on CNBC’s Squawk Box, she said lawmakers had spent more than nine months working with Democrats on the bill. Lummis argued the legislation would establish clearer rules for digital assets in the U.S.
“It’s the Wild West out there,” Lummis said. She added that the framework would help regulators target fraud while allowing legitimate crypto companies to continue operating in the country.
Bipartisan Negotiations Hit Final Roadblocks
However, disagreements emerged just hours before the committee session began. Journalist Eleanor Terrett reported that five pro-crypto Democrats met Thursday morning privately to discuss their voting strategy after negotiations stalled the previous night.
According to Terrett, ethical concerns were no longer the main issue. Instead, discussions shifted to the Blockchain Regulatory Certainty Act, known as BRCA. The measure would protect non-custodial software developers from prosecution under money transmitter laws.
Catherine Cortez Masto also pushed for amendments after law enforcement groups raised concerns earlier this week. As a result, several Democrats were expected to oppose the markup despite previous compromise discussions.
Terrett also shared comments from Cynthia Lummis following the failed negotiations. “Ultimately, we have agreement on 99% of the bill,” Lummis said. She warned lawmakers against waiting for another major crypto collapse before advancing regulation.
Senate Vote Represents Only the First Hurdle
Even if lawmakers approve the markup, the CLARITY Act still faces several political hurdles. The proposal would still require a Senate floor vote, coordination with the Agriculture Committee, and reconciliation with the House version.
Legal experts also remain divided on the bill’s chances of final passage. Joshua Riezman said the legislation has less than a 50% chance of approval during this session. He pointed to disagreements over stablecoin yield rules, ethics concerns, and decentralized finance provisions.
Lawmakers have already introduced more than 100 amendments covering stablecoins, conflicts of interest, and DeFi protections. Labor unions also voiced opposition ahead of Thursday’s hearing.
Supporters, however, continue comparing the measure to the GENIUS Act, which received bipartisan Senate approval last year. Crypto industry advocates also warned that prolonged delays could weaken U.S. competitiveness against regions including the European Union, Hong Kong, and the United Arab Emirates.
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