Galaxy Digital Sees 50% Chance of CLARITY Act Passing This Year as Key Issues Persist

Crypto firm Galaxy Digital has predicted a 50% chance that the CLARITY Act will pass this year, noting that key issues such as the clash over stablecoin yield could delay the legislative process. The crypto bill is already facing a setback as its markup is unlikely to happen this month, further creating a slimmer window to pass the bill.

CLARITY Act Has 50% Chance Of Passing This Year

In a research report, Galaxy Digital’s Head of Research, Alex Thorn, said that the odds of Trump signing the CLARITY Act into law this year are roughly 50-50 and possibly lower. He noted that the uncertainty stems from the number of unresolved issues that Comgress needs to settle in such a short time before they can advance the bill.

Notably, Senate Banking Commmitte Chair Tim Scott had cited three key hurdles, including the stablecoin yield language, DeFi provisions, and securing support from all Republicans on the committee before a markup for the crypto bill. Galaxy Digital stated that there are several additional issues, such as the ethics provisions, SEC-related concerns, and provisions around developer protections.

Thorn noted that these issues remain “live and could complicate the path forward.” At the same time, the CLARITY Act faces several legislative processes ahead. The crypto bill first has to undergo a markup and advance from the Senate Banking Committee.

As CoinGape reported, Senator Thom Tillis is pushing for the delay of the crypto bill’s markup to May, so they can resolve the clash between the banking and crypto industry over stablecoin rewards. Once the CLARITY Act advances from the committee, it must still clear a 60-vote Senate floor vote, followed by a reconciliation of the bill with the Agriculture Committee’s version of the market structure bill and the House-passed bill.

“Each step requires time on a rapidly diminishing legislative calendar: CLARITY must compete for scarce Senate floor time against the Iran military authorization debate, the unresolved DHS funding standoff, and a backlog of nominations,” the report noted.

The Senate’s Tight Calendar

Galaxy Digital stated that the Senate’s working calendar between now and the August recess is “limited and contested.” The Senate will be in session through the end of April, then have a break until May 11 before it works again till May 22. Furthermore, they will work for only three weeks in June and July and one week in August before going on a five-week recess.

“Every week of delay compresses the window for the sequential steps required to reach the President’s desk,” Thorn said. With the CLARITY Act markup now likely to happen in May, Galaxy Digital noted that a May markup is not fatal to the bill’s prospects if it happens early next month, especially if the bill gains bipartisan support during the markup vote.

Meanwhile, the firm warned that if the markup slips past mid-May, the probability of the crypto bill passing this year drops sharply, as the remaining legislative calendar cannot easily accommodate the full legislative process required to pass the bill. With time of the essence, crypto group The Digital Chamber recently sent a letter to the Senate Banking Committee, urging them to set a markup for the bill as soon as possible.

Galaxy Digital said that a floor vote in July is “theoretically possible” in the event the crypto bill’s markup is delayed past May. However, they noted that such a floor vote would require extraordinary “political will and coordination,” considering that it is close to the August recess and the midterm campaign season.

The report highlighted Senator Cynthia Lummis’ warning that failure to pass the CLARITY Act this year could delay the legislation until 2030. Thorn echoed this sentiment, noting that Congress could see a major reshuffle after the midterms, with the possibility of Democrats regaining control over the Senate.