Galaxy Research slashed its odds of the CLARITY Act becoming law in 2026 to just 10% on August 14. The firm cited a jammed Senate calendar, unresolved ethics provisions, and steady bank lobbying as the reasons the bill is now a long shot.
Why the odds tumbled
The CLARITY Act, which would set federal rules for digital assets, has been stuck in legislative limbo. Galaxy Research's downgrade from earlier estimates reflects three specific hurdles. First, the Senate's schedule is packed with must-pass spending bills and nominations, leaving little room for crypto legislation. Second, lawmakers haven't settled on ethics language — a sticking point that has quietly stalled progress. Third, banks have been actively pushing back against provisions they say would undermine their existing oversight.
That combination of pressure points made the 10% probability a realistic assessment, the firm said in its note. The downgrade came just as Congress left town for its August recess, meaning no floor votes or committee markups are possible until lawmakers return.
A vacuum, and two agencies filling it
With the legislative path narrowing, the Securities and Exchange Commission and the Commodity Futures Trading Commission are moving on their own. The SEC has been drafting rules that would treat most digital tokens as securities, while the CFTC has pushed forward on derivatives and market oversight. Neither agency is waiting for Congress to act.
That independent momentum creates a patchwork. Exchanges and issuers now face two sets of regulators with overlapping claims. The CLARITY Act was designed to draw clear lines between the two agencies, but its failure would leave that division fuzzy. In the absence of a law, the SEC and CFTC are effectively writing their own playbooks — and their priorities don't always align.
Bank lobbyists have argued that a broad crypto law would weaken existing consumer protections. Their influence on Capitol Hill is well documented, and it's one reason the bill's sponsors haven't been able to lock down the votes needed for a floor push. The ethics provisions, meanwhile, are seen by some lawmakers as a distraction from the core market structure questions.
What happens when Congress returns
The recess ends in September, and the Senate will have roughly a dozen working weeks before the end of the year. Leadership has not yet scheduled a hearing on the CLARITY Act. Even if it gets a markup, the calendar is unforgiving — any delay could push action into 2026, which is exactly the year the bill was aiming to address.
Galaxy Research's 10% odds aren't a death sentence, but they're a clear warning. The SEC and CFTC won't stop their rulemaking just because Congress is away. By the time lawmakers are back in Washington, both agencies could have finalized parts of their frameworks — making a comprehensive legislative fix even harder to sell.
