CLARITY Act gets July 17 field hearing; needs 7 Democrats

The House Financial Services Committee scheduled a July 17 field hearing in New York for the CLARITY Act. Senate passage requires seven Democratic votes to reach the 60-vote cloture threshold; a floor vote has not been scheduled. The bill cleared the House in July 2025 and has advanced through Senate committees.

On May 14, the Senate Banking Committee advanced an SEC-facing version of the bill by a 15-9 vote. All 13 Republicans and Democrats Ruben Gallego and Angela Alsobrooks voted to move the measure out of committee. Both Gallego and Alsobrooks have conditioned any floor support on additional changes, meaning the Senate needs at least five more Democrats plus near-unanimous Republican backing to invoke cloture.

A central dispute concerns Section 404, which would bar digital-asset firms from paying interest or yield solely for holding a payment stablecoin while allowing activity-based rewards tied to transactions, platform use, loyalty programs, liquidity provision, staking, governance or other participation. The provision delegates disclosure and rulemaking to joint action by the SEC and the CFTC.

Banking trade groups, including the American Bankers Association and the Bank Policy Institute, argued at the committee markup that the statutory language could permit interest-like products that would draw deposits away from banks. The crypto industry broadly accepted compromise language negotiated by Senators Thom Tillis and Angela Alsobrooks. More than 100 amendments were filed before the markup and no public resolution on Section 404 has emerged.

Legislative timing has tightened. Analysts reduced their odds of 2026 passage after the Senate spent floor time on a FISA reauthorization and debate over an anti-weaponization fund, and after limited visible progress on ethics and illicit-finance provisions that some Democrats require. Several analysts and bank strategists wrote that clearing the Senate by the end of July would be necessary to keep a 2026 path open; one market note warned that missing the August recess would materially weaken the bill’s prospects.

Political negotiations remain active. Alsobrooks has said she will withhold floor support until a requirement covering government officials’ cryptocurrency holdings is added. Senator Jack Reed filed about 20 amendments before the committee markup, and multiple Democrats pressed for stronger anti-money-laundering language.

The bill initially included a separate housing-supply provision, but that package was approved separately and removed from CLARITY. The July 17 hearing will provide a public forum for additional testimony, but it does not alter the Senate arithmetic needed for cloture. If supporters cannot secure seven Democratic votes for cloture before the August recess, congressional leaders and some sponsors have indicated the next practical window for a comprehensive CLARITY bill could be years away.