Donald Trump’s 2024 presidential campaign had a strong focus on the cryptocurrency industry. While trying to lure donations and votes, he promised favorable regulatory frameworks that could help it flourish.

The CLARITY Act was supposed to be the pièce de résistance. The long-awaited crypto market-structure bill has reached a decisive stage after passing the Senate Banking Committee, and Trump just held a major meeting. But then the odds dropped on most prediction markets. What does that mean, and where to next?

Progress and Staleness

It was precisely a year ago when the House of Representatives passed its version of the CLARITY Act with an impressive bipartisan vote of 294-134. It was this May that the aforementioned progress was made with the Senate Banking Committee, with two Democratic senators joining all Republican members in supporting the vote.

Both were viewed as major victories for the crypto industry, which has argued for years that confusing and unclear SEC and CFTC rules have turned investments away and forced local companies to move overseas. Under the proposed framework, the CFTC would gain clearer jurisdiction over spot markets, especially assets classified as commodities, while the SEC would retain authority over those that meet the definition of securities.

The bill is now placed on the Senate legislative calendar as №423, making it eligible for full Senate consideration. The issue stems from the fact that it needs more than just Republican support, as major such legislation requires at least 60 votes. Democrats have long pushed for stronger restrictions preventing senior government officials from profiting from crypto businesses. Trump is no exception here.

As such, many Dem. lawmakers have demanded different language in the bill to restrict elected or other senior officials from owning, issuing, or benefiting financially from certain crypto asset ventures. Does the Trump meme coin saga ring a bell?

Additionally, banks have argued that crypto platforms should not be allowed to offer interest-like payments or rewards on customers’ stablecoin balances. They fear such features could drive deposits away from traditional lenders.

White House meetings between banks and crypto reps earlier this year failed to resolve this dispute despite a reported compromise reached in May. Trump’s latest meeting also couldn’t reach equilibrium or make any significant progress.

What’s Next?

The first step would require the Senate leaders to agree to bring the bill to the floor, but negotiators would have to secure enough Democratic commitments to overcome the 60-vote threshold first. Another hurdle comes from the fact that there are two governing bodies overseeing the SEC and the CFTC – the Banking Committee and the Senate Agriculture Committee, respectively.

Both would have to be reconciled into a single Senate package before policymakers have a chance to vote on whether the language used in the joint effort is sufficient before it ever reaches Trump’s desk.

Although it is still theoretically possible for the bill to pass in 2026, the odds are rapidly dropping. Those supporting the legislation want the Senate to act before its August recess, but the November midterm elections cast a large shadow, as there is likely to be a major change of control in Congress.

The odds stood at around 40% earlier this week and above 70% after the advancement in the Senate Banking Committee in May. However, they have fallen to approximately 31% on most prediction markets after the latest struggles in the past week. Furthermore, Washington analysts believe it’s even less than that.

Source: CryptoPotato