Written by: Xiao Bing

The U.S. Senate concluded its summer recess and returned to Washington today (September 14).

One day later, at 2:15 PM Eastern Time on September 15, senators will conduct a cloture vote on H.R. 3633, known as the Clarity Act.

This is not the final vote, but rather a procedural vote that determines whether the Senate is willing to begin formal debate on the bill, requiring 60 votes to pass.

However, everyone knows that this procedural vote is effectively the substantive vote. If they cannot gather 60 votes, the Clarity Act will die before the 2026 midterm elections. Given the inertia of the election cycle, the next realistic legislative window will not be until 2029.

The U.S. cryptocurrency industry has been waiting for the market structure bill for eight years, hanging on a vote tomorrow afternoon.

The Final Sprint of a 630-page Bill

The night before the Senate returned (from late September 13 to early September 14), Senate Banking Committee Digital Assets Subcommittee Chair Cynthia Lummis, Agriculture Committee Chair John Boozman, and Banking Committee Chair Tim Scott jointly released the "final version" of the Clarity Act, document number EHF26724.

Lummis characterized this text as the Democrats' "last, best, and final offer."

There are several key changes in this text worth dissecting:

Ethics Provision: Trump's Conflict of Interest Finally Written in Black and White.

The new version requires federal officials and their spouses to divest their "substantial" cryptocurrency holdings or put them into qualified blind trusts. State attorneys general will have enforcement authority over the ethics provisions, a concession that the White House had previously resisted. Lummis claimed this covers about 80% of the content from the ethics counterproposal put forth by Senators Tillis and Gallego at the end of July.

Blockchain Regulatory Certainty Act (BRCA) Narrowed to Civil Areas.

Provisions protecting non-custodial software developers from being classified as money transmitters now only apply to civil enforcement under the Bank Secrecy Act and civil safe harbors. Language that previously might have extended into criminal cases has been removed, responding to long-standing concerns from the Prosecutors Association.

The Treasury Secures a "Circuit Breaker" Mechanism for Stablecoins.

If there is evidence showing a massive outflow of community bank deposits to stablecoins, the Treasury Secretary is authorized to intervene. This design, first proposed by Senator Tillis in July, was intended to assuage the fears of regional bank associations concerning "deposit disintermediation."

DeFi's Watershed: "Nominal Decentralization" Must Register.

Protocols that claim to be decentralized but are actually controlled by identifiable individuals or groups must register with the CFTC and comply with the Bank Secrecy Act. Truly decentralized infrastructure (providing interfaces, managing governance systems, participating in consensus validation) remains exempt from these requirements. The scope of DeFi provisions has been limited to spot and cash transactions of digital goods.

The Stablecoin Yield Battle is Not Over.

The bill prohibits passive stablecoin yields functionally equivalent to bank deposit interest but retains rewards tied to platform activities. Coinbase's annual revenue of approximately $1.35 billion from USDC rewards hangs in the balance of this wording. On September 10, 77 state-level banking associations nationwide jointly wrote to Senate leadership, urging revisions to the bill to block "balance- or holding-period-based stablecoin rewards," specifically targeting Coinbase.

Why Is It So Difficult?

The Republicans control 53 Senate seats. If the entire party is united, only 7 Democrats need to defect.

The problem is that they cannot achieve party unity.

Senator Rand Paul of Kentucky opposes it for libertarian reasons, arguing that any federal regulatory framework is an infringement on technological freedom. Senator Josh Hawley from Missouri opposes the bill for favoring large fintech companies. If 3 Republicans oppose, then 10 Democrats are needed; if 4 oppose, then 11 are needed.

The Democrats face an even greater challenge. On July 22, seven Democratic senators involved in negotiations jointly stated that the then-current text "falls short," citing ethics provisions, consumer protections, anti-money laundering, and conflict of interest as four areas of concern. Throughout August, no Democrat publicly announced a change in position.

As of today (September 14), Politico reported that the latest version of the bill still has not received any public support from Democratic senators.

Market predictions are even harsher.

Polymarket reduced the probability of the Clarity Act passing in 2026 from 82% in February to 16% by early September. Galaxy Research estimates it at 10%. Kalshi is slightly higher, around 22%.

Coinbase CEO Brian Armstrong is one of the few optimists. He told CNBC at the end of August that Senate Majority Leader Thune would not schedule a vote without certainty, believing they would ultimately surpass 60 votes.

Trump's Crypto Empire: The Largest Elephant in the Room

The legislative process of the Clarity Act has been repeatedly stalled since the beginning of this year by one question: How to handle the current president's conflict of interest in cryptocurrency.

Trump's crypto income soared by 250% during his term, reaching about $2.2 billion, primarily from World Liberty Financial and associated meme coin projects.

Democratic Senator Elizabeth Warren bluntly stated: "If a so-called ethics provision cannot prevent the president from profiting from cryptocurrency, cannot stop him from using cryptocurrency to openly accept bribes, then it is nothing."

The text from July 22 included an ethics provision drafted jointly by Lummis and Senator Moreno alongside the White House, prohibiting federal officials from issuing or sponsoring new digital assets, but exempting existing holdings, conveniently covering all of Trump's family's current crypto assets. Democrats pointed out that this provision does not even cover Trump's sons, meaning the entire family's crypto empire is basically unaffected.

The latest version (released on September 14) has significantly strengthened the ethics provisions: requiring officials to divest substantial crypto holdings or use blind trusts, introducing enforcement authority for state attorneys general. Lummis claimed that Trump "voluntarily accepted the most comprehensive ethical restrictions in U.S. history."

However, as of this article's release, no Democratic senator has publicly responded to the new ethics provision.

Simulation

Even if the cloture vote passes tomorrow, the Clarity Act still faces a steep road ahead.

A successful cloture only means the Senate can begin formal debate; there will still be the amendment process, line-by-line votes, and a final vote. There are numerous differences between the Senate and House versions, requiring coordination between both chambers.

Meanwhile, time is almost up.

The office of House Majority Whip Tom Emmer has informed Republican lawmakers that the voting agenda for the weeks of September 21 and 28 has been entirely canceled. House members returned to Washington on September 14, but will leave in four days and won't return until after the midterm elections.

This means that even if the Senate remarkably completes all legislative processes within the next two weeks, the House simply does not have time to address the Senate's amended version.

Alex Thorn of Galaxy Research directly addressed this on X: "The House has only one week left in September. The chances of Clarity passing before the midterm elections are extremely low."

But what if the vote fails?

Coinbase CFO Alesia Haas provided a fallback solution at Goldman Sachs’ Communacopia tech conference on September 11.

She stated that there are three pathways to regulatory clarity: Congressional legislation, rules made by regulatory agencies, and court precedents. If the Clarity Act fails to pass the Senate, Coinbase believes regulatory framework established through the SEC and CFTC can still advance new products and services. SEC Chair Atkins and CFTC Chair Selig have both shown willingness to promote change through executive avenues.

The GENIUS Act, passed in July 2025, has already established a framework for reserves, disclosures, and licensing for stablecoins. The SEC has already adjusted its regulatory posture on cryptocurrency at the administrative level. The CFTC is also actively expanding its jurisdiction over the spot market for digital goods.

If the Clarity Act passes, it will undoubtedly be a milestone, permanently resolving the classification issue of "what is a security, what is a commodity," giving clear legal status to mainstream tokens like BTC, ETH, SOL, and XRP. But if it doesn't pass, the industry won't stop; it will continue to operate in an even more fragmented and administratively discretionary regulatory environment.

In the short term, the vote outcome directly impacts UNI (Uniswap is aggressively promoting stablecoin infrastructure, and the stablecoin provisions of the Clarity Act are highly related to its strategy), COIN (Coinbase's stock price is extremely sensitive to regulatory news, and the stablecoin yield provisions directly affect its annual revenue structure), and CRV (the clarity of stablecoin regulation determines the long-term growth potential of on-chain stablecoin liquidity).

In the long term, the true significance of the Clarity Act lies in its answer to a meta question: Should the cryptocurrency industry be governed by Congressional law, or by regulatory agency rules?

The answer will be revealed soon.