Senate Clarity Act faces collapse as bipartisan support stalls

Senator Cynthia Lummis, the bill’s leading advocate, placed the blame squarely on Democratic negotiators. Lummis argued that the White House has already accepted significant ethics concessions, and that further demands regarding presidential conflicts of interest are politically motivated. She maintained that the failure of the act would rest on the refusal of Democrats to embrace a framework designed to secure U.S. leadership in digital assets and combat illicit finance.

At the heart of the impasse are three main friction points: presidential ethics, stablecoin rewards, and DeFi developer liability. Democratic senators remain unsatisfied with proposed language regarding digital asset businesses linked to the President and his family, such as World Liberty Financial. Simultaneously, banking interests continue to lobby against provisions allowing exchanges to offer rewards on stablecoin balances, fearing the practice will drain deposits from traditional insured institutions. With Republicans holding only 53 seats, the bill requires at least seven Democratic or independent votes to overcome a filibuster. Senate Majority Leader John Thune has scheduled the cloture vote for 2:15 p.m. ET, but limited time before the November midterm elections leaves little room for additional compromise.