US Treasury's Bessent Presses Senate to Pass CLARITY Act Before Summer
US Treasury Secretary Scott Bessent is urging the Senate to pass the CLARITY Act before the summer recess, arguing that regulatory uncertainty has pushed crypto innovation to jurisdictions with clearer rules. In a Wall Street Journal op-ed, Bessent said US domicile has too often left crypto firms with more risk than reward, and framed economic security as inseparable from national security, placing digital-asset regulation squarely in a geopolitical context.
CLARITY Act sets three-tier digital-asset regime
House Financial Services Chairman French Hill introduced the CLARITY Act (H.R. 3633) on May 29, 2025. The House approved it 294–134 on July 17 during the so-called "Crypto Week." The bill creates a three-tier classification system for digital assets and splits oversight between the SEC and the CFTC. It grants the CFTC exclusive authority over spot markets for digital commodities, while the SEC retains jurisdiction over "Investment Contract Assets." The measure also adds new registration requirements for digital-commodity exchanges, broker-dealers, and custodians.
Market participants have long viewed the SEC–CFTC turf battle as a major barrier to institutional crypto activity in the US. The bill would pair with the GENIUS Act, signed in July 2025, which requires 1:1 reserves for stablecoins. Together, the two laws underpin the Trump administration's digital-asset regulatory framework.
Stablecoin interest is the Senate's central fault line
The CLARITY Act has been stalled in the Senate for months, with the key dispute focused on whether firms such as Coinbase should be allowed to pay interest on stablecoins. JPMorgan and Bank of America have warned that permitting stablecoin interest could pull as much as $6.6 trillion in deposits from banks.
A White House Council of Economic Advisers (CEA) analysis published April 8 challenged that claim. The study found that banning stablecoin interest would lift bank lending by only $2.1 billion, or 0.02%, with virtually no benefit to community banks. It also estimated an $800 million consumer welfare loss and said stablecoin reserves would largely remain within the banking system in any case.
The administration's stance has been clear. President Trump publicly sided with the crypto industry over major banks as early as March, and the CEA report provides economic support for that position. Senators Thom Tillis and Angela Alsobrooks offered a compromise on March 20: passive stablecoin interest would remain prohibited, but activity-based rewards tied to payments, transfers, and platform usage would be allowed.
Delays, blunt rhetoric, and a narrowing legislative window
In the Senate, the process has been marked by repeated slippage. Senators Tim Scott and Cynthia Lummis circulated a discussion draft in July 2025, followed by a 182-page draft of the Responsible Financial Innovation Act in September. In December 2025, White House crypto and AI adviser David Sacks said a Senate markup would take place in January 2026, but the Banking Committee postponed it on the scheduled day.
Bessent appeared before the Senate Banking Committee in February 2026 and delivered unusually sharp remarks, calling opponents within the industry a "nihilistic group that prefers no regulation to this very good regulation." He added that those who did not want the law should move to El Salvador.
Negotiators say the stablecoin interest issue is "99 percent resolved," but Senate Republicans are weighing whether to attach community-bank deregulation provisions to the CLARITY Act, opening a new potential obstacle.
The calendar is tightening ahead of the 2026 midterms. Senator Bernie Moreno warned that if Congress does not make progress by May, it may not return to digital-asset legislation for years. That puts the Senate Banking Committee markup planned for late April at the center of the timeline.
Even with strong House support, Senate passage remains the hardest step. After a closed-door GOP meeting, Senator Cynthia Lummis, one of the Senate's best-known crypto advocates, said the path forward was "not the one she had expected."
For the industry, the stakes are significant. The CLARITY Act would, for the first time, set clear jurisdictional boundaries between the SEC and CFTC and would curb the "regulation by enforcement" approach associated with former SEC Chair Gary Gensler. JPMorgan analysts say passage by mid-2026 would be a positive catalyst for institutional scaling and tokenization. They also note a key irony: the same major banks opposing stablecoin interest could benefit from the bill's expanded crypto custody rules.
