According to Politico, Senate Republicans are wrapping up business and heading out of D.C. for their August recess after failing to secure the necessary Democratic votes to push the CLARITY Act forward. Still, bipartisan negotiations are far from dead, meaning leadership could pivot if both sides manage to strike a last-minute deal.
High hopes crushed
Senate Majority Leader John Thune can still file for cloture, setting up an immediate procedural vote once senators return to the Capitol in mid-September.
The delay comes as a curveball following aggressive remarks made just a day prior. On August 6, Senate Banking Committee Chairman Tim Scott went on Fox Business insisting that the initial procedural vote for the CLARITY Act must happen before lawmakers broke for summer recess.
Scott argued that Thune had plenty of time to get the legislation on the docket, adding that the Senate could easily extend its session past the scheduled schedule if necessary.
September risk vectors
Crypto traders are keeping their expectations low for the September session. A user under the handle Sorrento argued that the bill is bound to fail in September, setting up a market bottom in October followed by a slow, grind-up recovery.
Other market observers consider that playbook too predictable, pointing out that Bitcoin historically loves to front-run and do the exact opposite of what the consensus expects.
The CLARITY Act was designed as a comprehensive blueprint to draw clear jurisdictional lines between the SEC and the CFTC, while establishing strict rules for stablecoin issuers and digital asset exchanges.
Dragging out the vote leaves the U.S. crypto sector trapped in regulatory limbo for at least another month and a half.