Previous article
The US Senate blocked consideration of the CLARITY Act.
Сryptocurrency
On September 15, the U.S. Senate failed to advance the CLARITY Act
—a bill intended to establish uniform regulations for the American cryptocurrency market—according to *The Wall Street Journal*. Forty-nine senators voted to move to the next stage, while 50 voted against it; 60 votes were required. Four Republicans joined the Democrats.
**Reasons for blocking the bill**
Throughout the legislative process, the primary source of opposition centered on ethical concerns regarding the cryptocurrency holdings of President Donald Trump and his family. Critics of the CLARITY Act—mostly Democrats—argued that Trump could personally profit from decisions affecting cryptocurrency industry regulations.
Conflict also arose regarding stablecoins. Banks fear that crypto companies could lure away customer deposits by offering stablecoin holders various forms of rewards. In its current form, the CLARITY Act prohibits the payment of yield on idle stablecoin balances if doing so effectively equates them to bank deposits. However, stablecoin issuers are permitted to offer rewards—such as cashback—for using the tokens to pay for goods or conduct other transactions. Banking organizations sought stricter limitations, whereas the crypto industry opposed them.
Prior to the vote, Republicans attempted to address some of the opponents' concerns by introducing a revised version of the bill on Sunday, September 13. This new version tightened restrictions on federal officials and their families profiting from cryptocurrency projects. It also granted state attorneys general additional authority to enforce these rules. Nevertheless, Democrats deemed the ethical safeguards insufficient. Senator Mark Warner, a Democrat, stated that he voted against the bill because it failed to address the "fundamental conflict of interest" associated with Trump’s crypto projects. "The president should not be able to use the power and influence of his office to profit from his own cryptocurrency holdings," Warner said. "Any serious cryptocurrency legislation must include significant ethical safeguards preventing the president and other high-ranking government officials from profiting from policies they themselves shape."
"We need cryptocurrency regulation, but voting for this bill is a vote for Donald Trump’s corruption and for putting American families, the American economy, and our national security at risk," said Democratic Senator Elizabeth Warren, who urged her fellow Democrats to vote against the CLARITY Act.
What’s next?
The failed vote does not mean the CLARITY Act cannot still be passed. The vote held in the Senate on September 15 was not on the bill itself, but on whether to begin considering it. According to Reuters, after the vote, Republican Senator Thom Tillis switched his vote from "yea" to "nay," allowing him to move to reconsider the result; this means the bill could formally be brought to a vote again.
For the CLARITY Act to move forward, Republicans will need to reach an agreement with Democrats and secure at least 60 votes for a new procedural vote. If successful, the Senate could proceed to debate the text and vote on the bill itself. Once approved by the Senate, the measure would have to pass the House of Representatives before going to the president for a signature. However, Congress is set to go into recess soon ahead of the November midterm elections, leaving little time for further negotiations during the current session.