Senate prepares new CLARITY Act draft

TLDR

The U.S. Senate is moving toward a new merged draft of the CLARITY Act, a major bill to define U.S. crypto market rules, but it faces tight timing and political hurdles.

1. The updated Digital Asset Market CLARITY Act would merge Banking and Agriculture committee texts into a single, expanded draft released as soon as next week, with a possible floor vote in late July.
2. Passage still needs 60 Senate votes, and talks are stuck on ethics rules for officials, protections for non?custodial developers, DeFi and stablecoin provisions, and regulator staffing.
3. The bill would set a federal framework splitting crypto oversight between the SEC and CFTC, so traders and builders should watch the July 20 vote window and August 7 recess deadline closely.

Deep Dive

1. What The New Draft Does

The CLARITY Act (Digital Asset Market CLARITY Act) is a comprehensive market?structure bill aimed at giving the U.S. a single federal framework for digital asset trading, custody, and disclosures, and clarifying which assets fall under the SEC versus the CFTC. The House already passed its version 294134 in 2025, and the Senate Banking Committee advanced its draft in a 159 vote in May 2026.

Senate negotiators are now preparing a merged draft that combines the Banking Committees SEC?focused text with Agricultures CFTC?focused text, adding more than 70 pages and putting greater emphasis on consumer protections and market?structure safeguards. That unified version could be released as soon as the week of July 13, with Senate floor action targeted for the week of July 20 before the August 7 recess deadline.

2. Key Political Sticking Points

The bill cannot move without at least 60 votes, and Democratic support is the main missing piece. Reports highlight an unresolved ethics provision that would bar senior officials, including the president, from holding crypto?related business interests, which several Democrats call a precondition for their support.

Other hotly debated items include Section 604 and related Blockchain Regulatory Certainty language that protect non?custodial blockchain developers from being treated as money transmitters, law?enforcement concerns about DeFi and anti?money?laundering enforcement, and stablecoin yield rules that banks argue could undercut deposit products. A parallel dispute over vacant Democratic seats at the SEC and CFTC has also become part of negotiations, as those agencies would receive expanded responsibilities under CLARITY.

3. Impact On Crypto And What To Watch

Substantively, CLARITY would put spot digital commodities (like many non?security tokens) under CFTC oversight while leaving securities?type tokens with the SEC, and require clear rules for exchange registration, customer?asset protection, disclosures, and bankruptcy treatment. CFTC Chair Michael Selig has warned that if Congress does not act, regulators will improvise policy via agency rulemaking, leaving markets with a patchwork of guidance instead of statute.

Supporters such as Senator Cynthia Lummis frame this as a competitiveness issue and suggest this may be the last realistic window for comprehensive digital asset legislation before 2030. For crypto users, the key signals are whether a merged draft actually drops next week, whether ethics language reaches a compromise that unlocks Democratic votes, and whether Senate leaders reserve floor time in the narrow late?July window.

Conclusion

The new CLARITY Act draft represents a serious attempt to finally codify who regulates which parts of the U.S. crypto market, but it is racing a tight Senate calendar and deep partisan disagreements. Crypto participants should treat the next few weeks as a critical policy window, watching both the release of the merged text and signals from key Democratic senators to gauge whether regulatory clarity will come from legislation or continue to be pieced together by the SEC and CFTC.