Will Congress Reject the CLARITY Act Today? What to Expect

By Nynu Jamal

The CLARITY Act is facing a major test today in Congress, with lawmakers preparing for a key vote. While the crypto bill has received support from across the industry, it is still facing opposition from state officials and policy groups. Thus, the market structure bill continues to face uncertainty, even as its odds of advancing appear to be improving just hours before the vote.

Why is the CLARITY Act still facing uncertainty?

Despite efforts to build bipartisan support, the CLARITY Act is still facing opposition from different sides. A group of 18 attorneys, led by New York Attorney General Letitia James, has urged lawmakers to reject the crypto bill, citing fraud concerns. At the same time, the Progressive Policy Institute has also criticized the legislation, arguing that the bill lacks strong safeguards.

State Attorneys General raise concerns over the crypto bill

NY Attorney General Letitia James and 17 other bipartisan attorneys general have urged Congress to reject the CLARITY Act as the crypto bill heads to a key vote today. They argue that the market structure bill could make it harder for states to protect investors. According to them, the bill lacks stronger investor protection rules, which makes it difficult for the states to tackle crypto scams and fraud. In an official statement, Letitia James noted,

“As written, the Clarity Act would embolden scammers and potentially strip attorneys general of our authority to protect our states’ investors and their wallets. Together with my attorney general colleagues, I urge Congress not to pass the Clarity Act.”

PPI urges senators to reject the CLARITY Act

In addition to the attorneys, the Progressive Policy Institute (PPI) has also raised concerns about the CLARITY Act ahead of today’s key Senate vote. According to Paul Weinstein Jr., a senior fellow at the think tank, the latest amendments made by Republicans were not enough to address key concerns surrounding the crypto industry.

PPI argues that the crypto bill still needs stronger protection measures against money laundering, corruption, and other illegal activities. The group stated, “PPI encourages senators to vote against the CLARITY Act as currently constructed, and work to develop legislation that would actually provide the safeguards needed to create a robust stablecoin sector.” They added,

“PPI would welcome considerably more clarity with regards to the crypto industry. Unfortunately, the so-called CLARITY Act fails to provide it. Despite some last minute concessions by Republicans, the bill still falls short of providing robust money-laundering and ethics safeguards needed to crack down on illicit activities and corruption.”

What to expect today?

As the Senate is expected to hold a key procedural vote on the CLARITY Act today, there is still uncertainty over the bill’s passage. The bill needs 60 votes to move forward, which means that in addition to Republicans, some Democrats should also vote in favor.  While the latest changes, like stronger ethics rules, state attorney general enforcement powers, and a temporary stablecoin “circuit breaker,” have improved the chances of passage, fresh opposition adds to the uncertainty.

If the CLARITY Act gets the required 60 votes, it would clear the initial Senate hurdle and move forward to the president’s desk. At the same time, if the bill fails to pass the Senate today, the CLARITY Act would once again face a major setback. The bill would need to make further changes to address existing concerns before it reaches another Senate vote.

It is worth noting that a rejection would not necessarily mean that the CLARITY Act is killed completely. Such a rejection would only mean that the bill could face further delays. If it potentially addresses the concerns, it could pass the Senate in the future, bringing the much-awaited clarity to the industry.

Source:: Will Congress Reject the CLARITY Act Today? What to Expect