Senate Banking Publishes Clarity Act Text Ahead of Thursday Vote

The Senate Banking Committee published the latest text of the Digital Asset Market Clarity Act just after midnight on Tuesday morning, two days before a Thursday markup vote that crypto lobbyists, banking trade groups and senior White House officials have spent the past several months trying to shape. The 309 pages contain few outright surprises, since industry insiders had been circulating drafts privately for weeks, but the public release confirms the policy ground on which the bill will move forward.

The Stablecoin Yield Compromise Made the Cut

The bill keeps the stablecoin yield language negotiated by Senators Thom Tillis and Angela Alsobrooks earlier this month, which had been the single biggest obstacle to a markup happening at all. The text prohibits the payment of interest or yield "solely in connection with the holding of payment stablecoins" or any payment "economically or functionally equivalent to the payment of interest or yield on an interest-bearing bank deposit." Activity-based rewards, the model Coinbase has been advocating for, remain permitted.

The compromise will require firms running stablecoin rewards programmes to restructure from a "buy and hold" model to a "buy and use" one. That works for crypto exchanges, where users are transacting regularly. It is less workable for products designed primarily as savings vehicles, which is the outcome the banking industry was pushing for.

The banking lobby has not given up. Over the weekend, the American Bankers Association, the Bank Policy Institute and the Independent Community Bankers of America jointly wrote to committee leadership arguing that the language still risks pulling deposits away from traditional banks. Research from Galaxy Digital published last week pushed back on that framing, arguing that the majority of stablecoin growth originates offshore, meaning foreign capital flowing into US banking infrastructure will likely exceed any domestic deposit migration.

DeFi Got Most of What It Asked For

The decentralised finance sector emerged from the latest draft in better shape than many advocates expected. The bill incorporates language from the Blockchain Regulatory Certainty Act, which protects software developers who do not control user funds from being treated as money transmitters. Additional protections under the Securities Exchange Act are also present, addressing one of the longest-standing concerns of the developer community.

The DeFi Education Fund said the most important provisions for developers and infrastructure providers are in this version, while flagging that it will track amendments offered during Thursday's session and oppose any that weaken those protections. Punchbowl News reported separately on Monday that lawmakers have agreed on additional law-enforcement provisions allowing prosecutors to pursue crypto-related money laundering more aggressively, which adds an enforcement layer without affecting the developer protections.

The Ethics Provision Is Not in This Draft and That Is the Real Problem

The conflict-of-interest section that would prevent government officials from profiting from crypto activity is absent from the released text. The Senate Banking Committee does not have jurisdiction over that issue, so it would need to be added later in the legislative process. The question is whether it will be added at all.

Democratic Senator Elizabeth Warren, the committee's ranking minority member, released a sharply worded statement alongside the bill's publication describing it as a vehicle for "Donald Trump's crypto corruption" and citing Bloomberg's estimate that the president and his family have earned at least $1.4 billion in gains from crypto-linked deals during his first year back in office. Senator Kirsten Gillibrand said at Consensus Miami 2026 last week that Democrats will not support a final bill without ethics language attached.

The White House position, articulated by crypto adviser Patrick Witt at the same conference, is that the administration would accept rules that apply uniformly across all federal officials but would reject anything specifically targeting the president. That gap, between Democrats who want a clear restriction on Trump and the White House refusing to accept one, is what threatens the bill's path to the 60 votes it needs on the Senate floor.

What Happens After Thursday

A successful markup on Thursday would clear the bill out of the Banking Committee, but several steps still separate it from President Trump's desk. The Banking Committee's version will need to be merged with a similar bill already approved by the Senate Agriculture Committee, which holds joint jurisdiction over digital commodity oversight through the CFTC. The ethics provision then has to be negotiated into the combined text. Only after that does the bill reach the Senate floor, where it needs 60 votes, meaning meaningful Democratic support.

The White House is targeting passage by 4 July. Senator Gillibrand has predicted early August as more realistic. Polymarket currently prices the probability of the Clarity Act being signed into law before the end of 2026 at around 67 to 71%. That is materially below certainty but well above the implied probability a year ago, when the bill was stuck in committee with no compromise in sight on the yield question.

The legislation matters because it determines whether the US crypto industry operates under clear rules or continues to navigate the regulatory grey zones that have shaped the past several years. Bitcoin markets have already partly priced in passage. The question now is whether the politics of the ethics provision allow the bill to survive its next stages, or whether it joins the long list of crypto legislation that got close to the finish line and then collapsed.