The CLARITY Act's path to passage narrowed significantly this week as prediction market odds tumbled to 31-35%, a steep drop from the 70% peak seen earlier this year. The White House is weighing an ethics counteroffer that would involve state attorneys general, but bipartisan negotiators remain divided over how much power those state officials should have to enforce ethics rules against federal officials.
Prediction markets sour
Polymarket and other prediction platforms now give the bill roughly a one-in-three chance of becoming law in 2026. That's a dramatic reversal from the optimism that surrounded the CLARITY Act earlier this year, when odds hit 70%. The slide reflects growing skepticism that lawmakers can bridge their differences before the Senate's August recess begins next week.
State AGs vs. DOJ enforcement
At the heart of the impasse is a dispute over enforcement. Senator Thom Tillis (R-NC) and Arizona Democrat Ruben Gallego have been leading bipartisan talks. Both believe the bill needs a stronger ethics package than the one the White House and two Senate Republicans proposed at the end of July. The initial White House offer didn't get approval from Tillis, Gallego, or other Democrats. The core demand: state attorneys general should be able to sue the Department of Justice if it fails to enforce ethics laws against federal officials. The White House's proposed ethics provisions would remain in force only through January 2029, with no clear plan for what happens after that.
Saylor: 'America needs clarity'
Michael Saylor, chairman of the world's largest corporate holder of bitcoin, publicly backed the CLARITY Act this week. "Bitcoin will succeed with or without legislation, but America needs clarity for digital assets," Saylor said. His endorsement underscores the industry's desire for a federal framework, even as the bill's prospects dim.
Senate recess deadline
The Senate is scheduled to begin its August recess next week, leaving only a narrow window for the bill to advance. If lawmakers fail to move the CLARITY Act forward before the break, prospects are likely to deteriorate significantly as attention shifts to the midterm elections. The White House's next move on the ethics counteroffer could determine whether the bill survives this weekend's negotiations.
