Summary
- The Senate will not conduct a procedural vote on the Clarity Act before its month-long recess.
- Republicans require about six Democratic votes to surpass the 60-vote threshold.
- If approved, the bill will return to the House before reaching President Trump's desk.
The U.S. Senate has decided to postpone voting on the Clarity Act until September, deferring the bill that aims to establish a framework for the cryptocurrency market until after its August recess and just before the midterm election campaigning heats up.
Senate Majority Leader John Thune (R-SD) confirmed the postponement on Thursday, stating, "The Dems are insistent on no Clarity vote." He mentioned his collaboration with the bill's proponents, including Senator Cynthia Lummis (R-WY), noting that they are ready to prioritize it upon their return.
.@LeaderJohnThune announces Clarity will be on the floor in September:
“The Dems are insistent on no Clarity vote... I worked with sponsors of the bill. @SenLummis was great, and we’re getting that queued up first thing when we come back.”
— Stacey Daniels (@staceydanielsDC) August 7, 2026
The Senate will recess starting Friday and reconvene in mid-September for a brief period before attention shifts to the November elections, making this the last feasible opportunity for a vote this year. A source familiar with the situation informed The Block that Senate Democrats are hesitant to vote on the bill before the midterms due to the increasing political power of the crypto sector, and the delay allows time to gather the necessary 60 votes.
The voting dynamics have remained unchanged since the bill passed the Senate Banking Committee with a 15-9 vote in May, where only two Democrats, Ruben Gallego (D-AZ) and Angela Alsobrooks (D-MD), supported it. To succeed on the Senate floor, approximately six Democratic votes are needed. Republican backing has also been inconsistent. If the bill passes in the Senate, it will return to the House for another vote before it can reach President Donald Trump.
Ethics Issues Present Challenges
The ongoing obstacles are the same that have plagued the bill for much of the year: concerns regarding stablecoin incentives, the adequacy of law enforcement measures against illicit financial activities, and particularly the ethics clauses related to Trump's crypto investments.
These clauses could significantly benefit him. An amendment negotiated by Senators Thom Tillis (R-NC) and Gallego, which is yet to be publicly disclosed and is still being finalized with the White House, would obligate the president to divest from crypto-related enterprises. Such a divestment could allow him to postpone federal capital gains taxes on those assets for years, as reported by Bloomberg, and if he holds onto the new investments until his death, the gains would escape taxation entirely.
Trump has reported earnings of $1.4 billion from crypto and meme coins in 2025, and he possesses a 38% interest in World Liberty Financial through a related firm. Without tax deferral, he would incur a 20% tax rate. Both Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent have utilized the same provision for their divestments.
The amendment would also empower state attorneys general to enforce the ethics regulations if the Justice Department declines to act. It remains unclear whether Trump will agree to this condition.
Recently, Decrypt reported that the bill's chances of passing were dwindling, with Thune already indicating that it would not be voted on before the recess. Galaxy Research has reduced its projections for the bill's passage this year to a mere chance, a 'coin toss,' as of June.
Industry representatives have expressed determination, with Crypto Council for Innovation CEO Ji Hun Kim stating that while the delay is disappointing, the overall direction remains unchanged. He emphasized that every day without a regulatory framework "pushes American users and builders offshore and leaves consumers at risk," according to his statement.
If the Clarity Act fails, there is a backup plan. SEC Chair Paul Atkins mentioned last month that the agency is prepared to establish crypto regulations on its own should the legislation falter, a scenario that the industry has opposed due to the fact that regulations developed through rulemaking can be overturned by subsequent administrations.