The Digital Asset Market Clarity Act, commonly known as the CLARITY Act, officially cleared the U.S. Senate Banking Committee on Thursday, May 14, 2026, in a historic 15-9 bipartisan vote. All 13 Republicans on the committee voted in favor, joined by Democratic Senators Ruben Gallego of Arizona and Angela Alsobrooks of Maryland.
The bill now advances to the full Senate floor, where it will need 60 votes to overcome a filibuster, meaning at least seven Democrats must cross the aisle for the legislation to survive.
The White House has set an ambitious July 4 signing target, though significant hurdles remain, including unresolved ethics provisions related to government officials profiting from crypto, DeFi treatment, and law enforcement concerns.
Also Read: CLARITY Act Timeline: From 15-9 Senate Win to July 4 Signing, Here Is Every Step Ahead
What is the CLARITY Act?
The CLARITY Act, formally the Digital Asset Market Clarity Act of 2025, was first introduced as H.R. 3633 by House Financial Services Committee Chairman French Hill on May 29, 2025. The House of Representatives passed its version in July 2025 with a decisive 294-134 vote. However, the bill stalled in the Senate for months, primarily over disputes between the banking industry and crypto firms regarding stablecoin yield provisions.
At its core, the legislation attempts to answer one of the most contentious questions in U.S. crypto regulation: when is a digital asset a security and when is it a commodity? The bill creates a clear jurisdictional split between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
The markup: A contentious but decisive day
The May 14 markup was anything but smooth. Late-night negotiations between bipartisan senators collapsed without a final deal just hours before the hearing began. Senator Cynthia Lummis, who leads the panel’s digital assets subcommittee and called this “the hardest piece of legislation I have ever worked on,” issued a pointed statement saying lawmakers had agreed on 99% of the bill, with ethics and blockchain regulatory certainty provisions still unresolved.
Committee Chairman Tim Scott opened the hearing by framing the bill as a necessary step to end years of regulatory confusion. “For years, the digital frontier was trapped in a regulatory gray zone. Developers, entrepreneurs and investors were left with uncertainty. They faced confusion and enforcement actions, when instead, the government should have been crafting clear rules of the road,” he said.
Senator Elizabeth Warren sharply
The bill, calling it “just not ready” and arguing that Congress should be focused on bringing down prices for American families rather than writing legislation she said was crafted “by the crypto industry for the crypto industry.”
Dozens of amendments were debated and voted on. Democratic amendments targeting law enforcement loopholes, retirement account protections, and ethics provisions were largely voted down along party lines. A notable bipartisan win was Senator Mike Rounds’ amendment to adopt sandboxes for artificial intelligence tools, which passed 15-9.
In a last-minute maneuver, Chairman Scott secured the bipartisan vote by admitting further amendment discussions, convincing Gallego and Alsobrooks to vote yes. Both Democrats made clear their support was conditional. “My vote today is a vote to keep working in good faith,” Senator Alsobrooks said. “We still have so much work to do.”
What happens next?
The bill must now be merged with a parallel version that already cleared the Senate Agriculture Committee. Lawmakers also need to resolve the sticky conflict-of-interest provision before a final version can go to the full Senate floor.
White House crypto adviser Patrick Witt told a Consensus Miami 2026 audience earlier this month that the administration’s negotiating posture is to establish ethics rules that apply “across the board, from the president all the way down to the brand new intern on Capitol Hill,” but would reject anything that singles out a particular officeholder.
Cody Carbone, CEO of The Digital Chamber, told reporters that striking a deal on that ethics provision is likely to be what gets the eventual Senate vote beyond the 60-vote threshold. Senator Kirsten Gillibrand has said the CLARITY Act will not get approved in the Senate without ethics language.
Congress heads into Memorial Day recess on May 21, and both Senators Lummis and Bernie Moreno have warned that missing this legislative window could push meaningful crypto legislation to 2030 or beyond.
Even in the best-case scenario, enforceable rules will not exist until 2027. Agency rulemaking by the SEC, CFTC, and Treasury, including public comment periods, revisions, and final rule publications, takes at least a year under federal administrative law.
Market reaction
Markets responded positively to the vote. Bitcoin and Ethereum both moved higher on Thursday, while several regulatory-sensitive tokens gained sharply. Hyperliquid rose around 11%, XDC and Canton gained nearly 10%, reflecting renewed interest in institutional blockchain rails, tokenization, and regulated on-chain finance. However, Bitcoin gave back those gains on Friday as a broader macro selloff hit risk assets.
Crypto leaders react: What the industry is saying
The passage of the CLARITY Act through committee triggered an avalanche of commentary from across the global crypto ecosystem. Here is what the biggest voices in the space had to say.
Major industry CEOs and public reactions
Brian Armstrong, CEO of Coinbase, who had single-handedly caused the January markup to be postponed by pulling the company’s support, endorsed the revised bill and called the vote “a big opportunity to move America’s financial system forward” in a post on X.
He described the latest version as a true compromise and told FOX Business that many bank CEOs are leaning into crypto. “We’re at a place now where all American companies can finally start to build this industry,” he said.
Ripple CEO Brad Garlinghouse said the company stands behind the bill. “If the largest economy in the world is going to lead on crypto, and it must, this is the moment. Let’s get it done!” he posted on X. He had earlier estimated a 70% likelihood of the act being passed this year.
Ripple’s Chief Legal Officer Stuart Alderoty cited the National Crypto Association’s 2026 report estimating 67 million Americans hold crypto and said they “deserve clear rules” and “a regulatory framework that allows responsible innovations to grow here in the United States.”
Former White House crypto and AI czar David Sacks called the markup “a monumental step” toward making the U.S. the crypto capital of the world.
Circle’s Chief Strategy Officer Dante Disparte said the approval “marks meaningful, bipartisan progress” and noted that regulated payment stablecoins like USDC are already accelerating global economic activity.
Blockchain Association CEO Summer Mersinger called it “a defining moment for American leadership,” adding that regulatory uncertainty has for too long “sent talent, investment, and innovation overseas.”
Exclusive comments shared with The Crypto Times
Alongside the public statements from major CEOs and policymakers, 19 crypto executives from across the globe shared exclusive commentary directly with The Crypto Times team ahead of and following the May 14 markup.
The following section compiles their views on what the CLARITY Act means for DeFi, institutional adoption, tokenization, stablecoins, and global markets including India.
Binance weighs in
In a statement shared with Gopal Solanky, Senior Research Analyst at The Crypto Times, Steven McWhirter, Global Policy Lead at Binance, said the advancement “reflects the growing recognition that the United States requires a coherent, durable and globally competitive framework for digital asset markets.”
He stressed the importance of bipartisan efforts to deliver a balanced framework reinforcing standards around consumer protection, market integrity, and financial crime compliance.
Coinbase APAC on India’s opportunity
In a statement shared with Gopal, John O’Loghlen, Head of APAC at Coinbase, called the CLARITY Act “a win for clear rules, which will benefit the banks, the crypto industry, and the end users.”
He specifically flagged India’s position, noting the country has “one of the largest retail crypto user bases and one of the fastest-growing onchain developer ecosystems in the world.” As global frameworks take shape, India has a real opportunity to shape the next chapter of financial services, he said.
DeFi builders see a turning point
In a statement shared with Gopal, Brian Huang, Co-Founder of Glider, said builders are pleased that non-custodial software services are legitimized as technology providers.
He welcomed clarity on tokenization but warned that anti-DeFi revisions “may be hard for genuine builders in the space when it comes to offering novel services, especially neo-banks and other growing categories.”
In a statement shared with Dishita Malvania, Senior Journalist at The Crypto Times, Orest Gavryliak, Chief Legal Officer at 1inch, called the markup a cause for cautious celebration. He highlighted the distinction between decentralized protocols and centralized intermediaries, with obligations proportional to the risks each creates.
Looking ahead, he predicted DeFi rails will serve as infrastructure for AI agents that execute trades and engage with networks. “The US is moving toward a regulatory environment that recognises crypto as a permanent part of the financial system,” he said.
In a statement shared with Dishita, David Reising, Founder and CEO of Lotus, a decentralized credit protocol, said DeFi is closer than ever to widespread acceptance. He argued the CFTC is “the more reliable long-term home” for DeFi oversight and said the bill would give sidelined institutions “the legal cover to engage.”
Institutional and infrastructure perspectives
In a statement shared with Jahnu Jagtap, Senior Research Analyst at The Crypto Times, Nathan McCauley, CEO and Co-Founder of Anchorage Digital, home to America’s first federally chartered crypto bank, said the vote reflects “the growing bipartisan recognition in Washington that digital assets are the future.” He urged the full Senate to pass the legislation as soon as possible.
In a statement shared with Jahnu and Dishita, Alexis Sirkia, Founder of Yellow Network, argued the yield compromise is just a headline. The real significance, he said, is that “the Senate now has workable language to move to markup, and the provisions that actually shape market structure, the DeFi framework, the SEC/CFTC jurisdictional boundary, the treatment of intermediary obligations, are next in line.”
Market makers and institutional flow desks have been in a holding pattern because the regulatory perimeter has been undefined, and alignment between the Senate and House versions “will determine whether the final text is workable for the institutional layer.”
In a statement shared with Jahnu, Marcos Viriato, CEO and Co-Founder of Parfin, developer of the Rayls blockchain infrastructure platform, said the CLARITY Act will unlock institutional opportunity but cautioned the debate is too focused on token classification.
“The harder question goes unanswered: who is accountable when regulated assets move on-chain and something goes wrong?” He warned that institutional adoption “will remain slower than many expect” until accountability is built into the rails.
In a statement shared with Dishita, Shiv Shankar, CEO of Boundless, said the Act reduces uncertainty but stressed regulatory clarity alone may not be enough. It defines what compliance looks like, he said, but “what it doesn’t resolve is the infrastructure gap that comes with operating on networks that are transparent by design.”
Tokenization and market structure voices
In a statement shared with Gopal and Jahnu, Jason Rindahl, CEO of Nebula DeFi, a Tokenization-as-a-Service platform, called the progress a breakthrough in distinguishing between passive yield and activity-based rewards.
He said defining clear lanes “unlocks capital, drives innovation, and keeps next-gen infrastructure from being built offshore.” Markets “do not need perfection overnight. They need clearer rules of engagement,” he added.
In a statement shared with Dishita, Nitya Subramanian, CEO of Para, noted the bill goes far beyond crypto, opening the door for platforms with massive user bases to integrate financial services into everyday products.
“Suddenly, incumbents like JPMorgan are no longer just competing with fintechs or crypto exchanges, they’re competing with platforms like X Money or TikTok for ownership of the customer relationship,” she said.
Stablecoin issuers respond
In a statement shared with Dishita, Vincent Chok, CEO of First Digital, issuer of the FDUSD stablecoin, said the vote shows legislators are engaging with how stablecoins actually function rather than applying blanket restrictions. He warned that “the standards that the US sets will become the new benchmark that institutional partners across APAC and EMEA expect.”
The Global view: What it means for India and Asia
In a statement shared with Gopal, Vikas Gupta, CEO of Bybit India, said the Act’s focus on disclosure standards, consumer protection, and operational transparency “could improve investor confidence and strengthen the credibility of the broader digital asset ecosystem.”
He noted it could influence other jurisdictions to adopt more structured frameworks and that India will closely watch how the U.S. balances innovation with oversight.
In a statement shared with Dishita, Vikaas M Sachdeva, CEO of BitDelta India, said frameworks like the CLARITY Act “help move the market from interpretation to greater operational clarity.” For India, he noted the country already has strong participation and one of the world’s most digitally active investor bases. “The next phase for the industry globally will be shaped by how effectively markets build trust around the asset class.”
In a statement shared with Dishita, Ashish Singhal, Co-Founder of CoinSwitch, said despite over 40% of Americans having exposure to crypto, the industry has operated without a clearly defined legislative framework for more than a decade.
The CLARITY Act signals that “crypto regulation in the U.S. is entering a more mature phase” and these frameworks “could eventually become important global reference points.”
In a statement shared with Dishita, Sumit Gupta, Co-Founder of CoinDCX, called the CLARITY Act “a pivotal and much-awaited moment for global crypto regulation.” He said a comprehensive U.S. law can accelerate regulatory convergence globally, including in India.
Gupta praised the stablecoin yield compromise as something India should consider for its own approach, and added: “Markets ultimately run on trust. Any legislation that advances both regulatory clarity and ethical guardrails strengthens the long-term credibility of the entire asset class.”
Solana Research and XYO weigh in
In a statement shared with Divya Mistry, Editor-in-Chief at The Crypto Times, Angus Scott, Founder of the Solana Research Institute, said it was fortunate for the industry that first significant regulatory step was taken by a favorably disposed administration. He cautioned the CLARITY Act is “merely a first step down a long regulatory road” and pointed to the UAE, Singapore, and Hong Kong, which have not waited for American consensus.
In a statement shared with Divya, Markus Levin, Co-Founder of XYO, the first crypto company qualified by the SEC to sell shares under Regulation A to non-accredited investors, said the 15-9 vote “only means something if it marks the beginning of genuine bipartisan momentum rather than the extent of it.”
The hearing exposed a real divide: “Republicans treated this as a market structure bill. Democrats treated it as an ethics and enforcement bill.” On DeFi, he warned: “Drawing that line badly creates gaps that bad actors will find. That’s not an argument against the bill. That’s an argument for getting the drafting right.”
Self-custody gets federal recognition
In a statement shared with Jahnu, Jonathan Sexton, COO of Unchained, highlighted what he called the most historically significant element: “For the first time in American history, Congress is about to write self-custody protections into federal law.”
He said this amounts to the U.S. government recognizing a form of personal property it has no operational ability to freeze or seize. As AI agents move deeper into the machinery of money, “the country is going to need an ownership revival to meet that moment.”
The road ahead
The CLARITY Act has cleared its most significant Senate hurdle, but the road to becoming law remains narrow and full of political landmines. The Senate Agriculture Committee’s parallel version must be merged with the Banking Committee’s text. The ethics provision must be resolved to win enough Democratic votes on the floor.
The House, which passed its own version last year, will need to reconcile any differences with the final Senate text. And President Trump, whose family’s crypto entanglements are at the center of the ethics debate, will ultimately need to sign whatever lands on his desk.
Senator Lummis has called this a once-in-a-generation legislative window. Several lawmakers and industry observers have warned that if the bill does not clear the Senate before the August recess, midterm campaign politics could push the next viable window to 2030 or beyond.
For now, the crypto industry has its most tangible legislative victory in years. Whether it translates into law will depend on what happens in the next eight weeks.
Also Read: Chaos in the Ante Room: The Deal That Rescued the CLARITY Act
