TL;DR
- The CLARITY Act will not reach the Senate in 2025; political disagreements are delaying the vote and pushing the legislative timeline to early 2026.
- The deadlock centers on DeFi regulation: Democrats are pushing for identity and AML controls, while the industry and Republicans warn about innovation moving offshore.
- The debate adds partisan tensions tied to crypto businesses associated with Donald Trump and leaves the market without clearly defined structural rules in the short term.
The effort to define a clear regulatory framework for the U.S. crypto market has stalled once again. The CLARITY Act will not reach the Senate in 2025, and the debate has been postponed, at minimum, until early 2026. The confirmation came directly from Capitol Hill, where lawmakers acknowledged that the text is still not ready for a final vote.
The delay stems from internal disagreements that remain unresolved. Senator John Kennedy, a member of the Senate Banking Committee, said that while there has been partial progress in some areas, the core issues are still open. That lack of consensus left the Senate with no room to proceed with the committee markups planned for December and forced yet another shift in the legislative calendar.
The CLARITY Act Is Stalled by Political, Not Technical, Conflicts
The original goal was to pass the bill before the end of the year. That plan has now been scrapped. The new window moves to January 2026, adding another chapter to a debate that has dragged on for years and has left the U.S. crypto market without defined structural rules. The delay is not technical. It is political.
Tim Scott, chair of the Senate Banking Committee, confirmed that legislative work on the CLARITY Act will resume next year. Although the proposal carries different names in the House of Representatives and the Senate, Scott said lawmakers are treating it as a single crypto market structure bill. He also pointed to Democratic opposition, which he blamed for the blockage that has kept the text on hold.
The core of the dispute lies in DeFi regulation. There is agreement on the need for greater regulatory clarity, but not on the scope of oversight. In October, Democrats introduced a DeFi-specific proposal that includes identity verification and stricter anti-money-laundering requirements. That initiative deepened the divide.
Democrats Speak of “Crypto Corruption”
The industry reacted negatively to the suspension of the CLARITY Act. Companies and developers warned that those conditions would directly restrict DeFi activity in the United States. Several Republican lawmakers echoed that view, arguing that a restrictive framework would push innovation to other jurisdictions without improving user protection.
Partisan tensions added another layer to the dispute. Some Democrats argue that advancing crypto legislation could benefit businesses linked to President Donald Trump, including a Trump-branded memecoin, the World Liberty Financial project, and American Bitcoin, a mining firm co-founded by Eric Trump and Donald Trump Jr. Representative Maxine Waters was among the most vocal critics, referring to the debate as “crypto corruption.”
For now, the CLARITY Act remains in limbo. Congress has once again postponed defining rules for the crypto market, leaving the debate open and without a near-term resolution
