U.S. CLARITY Act stalls in Senate with Polymarket odds for 2026 passage falling to 31%, prompting Bernstein warning of potential crypto sell-off due to lost regulatory clarity.
Regulation & Gov ·
Prediction market odds for the CLARITY Act's passage by end-2026 have declined to 31%, representing a 7-point drop over a week, according to Polymarket data. Bernstein analysts cautioned that further deterioration in legislative prospects could spark a near-term cryptocurrency sell-off if the Senate fails to advance the bill before its August recess.
The CLARITY Act seeks to establish the first comprehensive U.S. regulatory framework for digital assets. It has faced resistance from banking industry groups, who contend that provisions allowing crypto firms to offer yields on stablecoins would exempt them from requirements imposed on traditional financial institutions. White House officials are separately considering a bipartisan ethics counterproposal negotiated between Republican and Democratic senators that would grant state attorneys general authority to sue the Department of Justice for non-enforcement of federal ethics laws.
The measure's stalled momentum reflects narrowing legislative windows. In late June, one institution lowered its own baseline forecast for 2026 enactment to 50%, citing Senate scheduling constraints. Institutional appetite for crypto holdings has been partly anchored by expectations of regulatory clarity; if the bill falters, near-term asset valuations could face pressure.