Will US Senators Pass CLARITY Act by Thanksgiving Despite Shutdown Standoff?

This article was first published on The Bit Journal: US Republican lawmakers intend to pass the CLARITY Act before the end of the year: is it possible for Congress to have the crypto market structure bill passed before midterms spoil the party?

Despite the ongoing government shutdown, bipartisan negotiations are on top gear in the US Senate on the CLARITY Act. Lawmakers are on a race against time to create a regulatory framework for cryptocurrencies before the election-year politics can spoil the party.

According to a report by Bloomberg, Republicans within the Senate have prepared documents they intend to pass before the end of 2025, which is a deadline they had announced earlier. Senate Agriculture Committee Chairman John Boozman revealed he was in talks with his Democrat counterparts in a bid to create a bipartisan version of the CLARITY Act. The lawmaker revealed that he expected the bill to be ready before 2026 and that it would provide a regulatory framework for digital assets.

The House of Representatives passed the CLARITY Act last July

The initiative by the Senate is being spearheaded by leading committee chairpersons and is backed heavily by industry supporters. The CLARITY Act aims to deal with persistent uncertainties within the crypto regulatory landscape, and to strengthen the US’s position as the world’s leader in digital finance.

The House of Representatives passed the CLARITY Act last July as part of the Republican “Crypto week.” The Senate version of the proposed law has been christened the “Responsible Financial Innovation Act,” and aims to create a unified legal framework for the digital asset marketplace and distribute oversight authority between the SEC and CFTC.

While the lawmakers are burning the midnight oil to try and pass the CLARITY Act, other Republicans like Banking Committee Sen. John Kennedy (La.) have argued that the bill wasn’t yet ready to go. Sen. Kennedy opines that the bill needed a public hearing, adding that most senators still didn’t understand the issue.

Opposition from some Lawmakers

Among the outstanding issues some lawmakers have raised include the reopening of law enacted in early 2025 governing stablecoins to tighten a ban on issuers of those assets paying interest. A bank lobby fears a flood of deposits would be siphoned out into stablecoin accounts, and they would like to see exchanges and other third parties added to that restriction. In his opposition, Republicans like Sen. Bernie Moreno (R-Ohio) stated:

“My goal would be out of committee before Thanksgiving and into law sometime in mid-December […] this is just about doing the right thing, making sure that we ensure American leadership, that we have a good regulatory framework that everybody’s happy with.”

Conclusion

Despite the optimism surrounding the passage of the CLARITY Act in Congress, the prediction markets have painted a gloomy picture. Data from Polymarket shows a paltry 25% chance of passing the CLARITY Act before the end of 2025, which is down from 87% in mid-July. Despite the support from President Trump, only time will tell if lawmakers can actually pass the bill by Thanksgiving.

Glossary of Key Terms

The SEC: U.S. Securities and Exchange Commission, an independent federal agency that protects investors, maintains fair and orderly markets, and facilitates capital formation.

CFTC: Commodity Futures Trading Commission, which is the U.S. federal agency that regulates the commodity futures, options, and swaps markets.

CLAIRTY Act: Digital Asset Market Clarity Act of 2025 is a proposed U.S. bill that aims to create a federal regulatory framework for digital assets by clarifying jurisdiction between the SEC and CFTC.

Frequently Asked Questions about the CLARITY Act

What is the CLARITY Act’s main purpose?

The Act’s primary goal is to provide regulatory certainty for the digital asset market by establishing a clear division of authority between the SEC and the CFTC.

How does the Act affect digital asset firms and exchanges?

It requires intermediaries handling digital commodities (exchanges, brokers, dealers) to register with the CFTC and adhere to specific standards, including customer fund segregation, robust AML/KYC programs, and conflict-of-interest disclosures.

Does the Act provide for investor and consumer protection?

Yes. It mandates clear and extensive disclosures by project developers, requires customer asset segregation by custodians, and puts in place anti-fraud and anti-manipulation rules under both the SEC and CFTC.