After months of delays, the U.S. Senate is expected to vote on the CLARITY Act on September 15, 2026. The vote might help the US crypto industry find an answer to a key question: who should regulate digital assets?
The debate on crypto regulation has lasted over a year. It includes months of discussions on how to divide regulatory tasks between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
For years, crypto companies, investors and regulators in the US have debated who should be in charge of regulating digital assets. The SEC treats some crypto assets and activities as securities, while the CFTC has jurisdiction over commodities and derivatives. As the market has grown, the boundaries of the areas they oversee have become more important. This is especially true for crypto exchanges, token issuers, and decentralised platforms.
If the CLARITY Act were to become law, it would set up a federal framework for digital assets. It will decide which assets and activities are commodities or securities. Also, it will clarify the roles of the SEC and CFTC in the market.
But getting there has proved difficult. The bill has already passed the House, yet disagreements in the Senate have delayed its progress and raised questions about whether lawmakers can reach a final agreement.
So, what exactly does the CLARITY Act propose? What prompted the legislation, why has it struggled to move through Congress, and what could it mean for crypto companies and investors if it becomes law?
How did the CLARITY Act begin?
The CLARITY Act did not begin from a single debate about crypto. It followed years of disagreement in Washington over how digital assets should fit into the existing financial regulatory system.
On May 29, 2025, Rep. French Hill, chairman of the House Financial Services Committee, introduced the Digital Asset Market Clarity Act of 2025, known as H.R. 3633. The bill was introduced alongside lawmakers from both parties. It was presented as an effort to establish clearer standards for the digital asset market while protecting consumers and supporting technological innovation.
The proposal also built on earlier attempts by Congress to create a market structure for crypto. One of the most notable was the FIT21 Act, which passed the House in May 2024 but did not become law. The CLARITY Act therefore entered Congress as part of a longer effort to define where crypto sits within the US financial system.
The bill began gathering momentum in the House in June 2025. The House Financial Services Committee advanced it by 32 to 19, while the House Agriculture Committee, which has jurisdiction over the CFTC, approved it by 47 to 6. The two committees were particularly important because the legislation dealt directly with the powers of both financial regulators.
Then came the House vote.
On July 17, 2025, the House passed the CLARITY Act by 294 votes to 134, with 78 Democrats joining Republicans in support. The result gave the bill significant bipartisan backing and sent it to the Senate for consideration.
But the House vote did not settle the regulatory debate. If anything, it moved the hardest part of the process to the Senate, where lawmakers would have to agree on the details of the proposed framework.
What does the CLARITY Act do?
The CLARITY Act would change how the US divides regulatory responsibility for digital assets. One of its biggest goals is to give the CFTC a larger role in overseeing digital commodities while creating clearer boundaries around the SEC's authority over assets and activities that fall under securities laws.
That distinction exists because the two agencies usually approach the crypto market from different directions. The SEC has pursued enforcement actions against companies and projects it believes are dealing in securities, while the CFTC has focused on commodities and derivatives. The uncertainty about which rules apply can affect everything from registration to product launches and day to day operations in the crypto space.
The proposed framework would establish categories for digital assets and set out requirements for companies operating in the market. It covers areas including digital commodity exchanges, brokers and dealers, registration, disclosures and recordkeeping. It also addresses issues involving anti money laundering rules, consumer protection and other safeguards.
Cryptocurrency exchanges could have clearer requirements for operating in the US. Token issuers could have a more defined path for determining how their assets are treated. Investors could have a better understanding of what protections apply to different products. And companies building blockchain based financial services would have a clearer idea of the rules they need to follow.
It also tries to determine what activities should be regulated and who should regulate them. That becomes particularly important as the industry expands beyond spot trading into decentralised finance, stablecoins, tokenised assets and other blockchain based products.
The bill therefore sits at the centre of a much bigger debate about how much of the crypto industry should fall under existing financial rules and how much needs a regulatory framework built specifically for digital assets.
Why has the CLARITY Act struggled to pass?
The House's 294 to 134 vote made the CLARITY Act look like a rare example of bipartisan agreement on crypto. The Senate process has been much less straightforward.
After receiving the House bill, Senate lawmakers spent months negotiating their own version. The Senate Banking Committee eventually advanced the legislation on May 14, 2026, in a 15 to 9 vote, with support from Democrats and Republicans.
However, several disagreements have continued to hold up the legislation, including questions around stablecoin rewards, consumer protection, anti money laundering requirements and ethics.
One of the more difficult debates concerns stablecoin rewards. Lawmakers have been trying to determine whether crypto platforms should be allowed to offer rewards or yield to users who hold payment stablecoins. The issue has attracted opposition from parts of the traditional banking industry, which argue that some stablecoin reward programmes could compete with bank deposits.
The Senate's work has attempted to draw a line between prohibited interest like payments and permitted rewards tied to transactions or other activities. But the issue has remained part of the negotiations.
Some Democrats have argued that the legislation does not go far enough in protecting consumers or addressing risks such as illicit finance. Supporters of the bill argue that the proposed framework would give regulators and law enforcement clearer authority while bringing more crypto activity into a regulated system.
Where does the CLARITY Act stand now?
On August 19, Trump hosted crypto executives and financial industry leaders at the White House, where the CLARITY Act was among the issues discussed. The meeting came as lawmakers continued negotiations ahead of the September vote.
The administration has pushed Congress to reach an agreement and establish clearer rules for the industry. White House crypto adviser Patrick Witt also said on August 18 that he was optimistic about the legislation's prospects and that the administration would continue working with lawmakers during the August recess.
The CLARITY Act has not become law. It has passed the House and cleared the Senate Banking Committee, but the full Senate has not yet voted to pass the legislation. The next major step is scheduled for September 15, when the Senate is expected to hold a procedural vote on whether to move forward with consideration of H.R. 3633.
However, the September vote is not the final vote on the CLARITY Act. If the Senate clears the hurdle, lawmakers must still debate the legislation, consider amendments, and then vote on whether to pass it. If the Senate approves a version that differs from the House bill, the two chambers would also have to resolve their differences before the legislation could reach the president's desk.
What does the CLARITY Act mean for crypto?
If the CLARITY Act becomes law, the most immediate change for the crypto industry could be more certainty about the rules governing digital assets in the US.
Exchanges and other crypto businesses would know which regulator has jurisdiction, which could make it easier to determine what registrations, disclosures and compliance requirements apply. Also, for token issuers, a clearer classification system could reduce some of the uncertainties around how their assets are treated under US law.
Investors could benefit from clearer rules. But the outcome will depend on the protections in the final legislation and how regulators enforce them. A clearer regulatory system does not automatically mean fewer risks for investors. This means there will be a clearer framework. It will show who is responsible for overseeing different market parts and what companies must do to operate legally.
The legislation could also impact decentralised finance, blockchain developers, and stablecoins. The extent of that impact will depend heavily on the final language Congress approves and how the SEC and CFTC interpret and enforce the new rules.
The legislation has come a long way since French Hill and other lawmakers introduced it in May 2025. It passed committee votes, gained strong bipartisan support in the House, and cleared the Senate Banking Committee after months of discussions.
The September 15 vote will determine whether the Senate is ready to take the next step, not whether the entire process is finished. Lawmakers still need to resolve their disagreements and finalise the bill before it can reach the president.
For an industry that has spent years asking for clearer rules, the CLARITY Act could be an important turning point. It is a question of whether the US will regulate crypto. The question is if Congress can set rules that provide the industry with certainty while still protecting investors and the financial system.