- The CLARITY Act faces a critical deadline, with odds of 2026 passage becoming “extremely low” if it doesn’t advance by the end of April, according to a crypto executive.
- A major sticking point is the debate over stablecoin rewards and their potential impact on the traditional banking system, but other issues like DeFi could surface next.
- Some analysts are pessimistic, with one investment bank warning the legislation may not pass until 2027 and take effect in 2029 if political dynamics shift.
The CLARITY Act, a pivotal U.S. crypto regulatory bill, may effectively be dead for the year if it fails to advance within the next seven weeks, according to Galaxy Digital executive Alex Thorn. Thorn stated in an X post that the bill must reach the Senate floor by early May as legislative time runs out.
Consequently, the perceived primary hurdle is a fierce debate over whether stablecoin rewards will disrupt traditional banking. However, Thorn warned this may not be the final obstacle, noting potential future clashes over DeFi and regulatory authority.
Meanwhile, key Democrat U.S. Senator Angela Alsobrooks indicated that both crypto and banking lobbies must accept compromises. “All of us will probably walk away just a little bit unhappy,” she recently stated.
This political friction creates significant uncertainty around the legislative timeline. While some lawmakers were optimistic about April progress, investment bank TD Cowen warned the bill may not pass until 2027.
Earlier this month, U.S. President Donald Trump criticized banks for stalling the bill over stablecoin yield disputes. “The US needs to get Market Structure done, ASAP,” Trump declared on March 4.
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