Clarity and Congressional Summer Recess: The State of Cryptocurrency

The narrative is clear. As White House adviser Patrick Witt said in May, the “Transparency Act” was not signed into law on July 4 as scheduledwishedThis is going to happen. Furthermore, the time for full adoption of the proposal is indeed rapidly shrinking.

Why is it important

If the Clarity Act fails to pass Congress before the midterm elections, there is uncertainty about what will happen after the elections. If the House or Senate were reversed, the bill would be less likely to pass in its current form, as Democrats would want to brand themselves on the bill. So if 2026 signing is still planned, basically we are at a critical moment.

resolving

No one wants to assert that the bill is dead yet. Three different people following the process said last weekend that they are still optimistic about the possibility that the bill will pass this year. There are a few different reasons for this.

Although the National Assembly will not be in permanent session this summer, most of the necessary work is still being carried out behind the scenes. It was pointed out that staff are still meeting to resolve various issues, including coordinating the Senate Agriculture Committee and Senate Banking Committee versions of the bill. It only takes a few days for the Senate to publicly discuss and vote on the bill.

Another source said the process shouldn't take too long — it would take about a few days to end the debate and get 60 votes to pass the bill. Afterwards, the House of Representatives shouldn't spend too much time passing the bill, although there are still some questions about this, which we'll discuss below.

Recent events — including a Supreme Court case that essentially stripped independent institutions of their independence and financial disclosure from former President Donald Trump — are also unlikely to have much impact on ongoing negotiations.

Last week, US President Donald Trump submitted disclosure documents for 2025, showing that his revenue last year reached $2 billion.Approximately $1.4 billionThis comes from the crypto industry and covers various revenue streams such as royalties paid by his meme coin company, World Liberty Financial's token sales, and sales to the Abu Dhabi Emirates. By contrast, his 2024 disclosure report showed “”tens of millions of dollars“Performance in overall revenue.

The president also revealed that he holds more than $100 million in multiple cryptocurrencies and has small shares in companies such as Corewave.

Democratic Senator Elizabeth Warren, the most senior member of the Senate Banking Committee, issued a statement after disclosure calling for moral provisions to be added to the Transparency Act. She said, “Cryptocurrency legislation to be submitted to the Senate for review must prevent the president, vice president, senior government officials, members of Congress, and their families from profiting from the cryptocurrency industry. Failure to do so will only accelerate Donald Trump's unscrupulous cryptocurrency corruption.”

Similarly, Senator Ruben Gallego said inPosts on XAfter disclosing that he would “do everything in his power to crack down on [Trump]'s corrupt crypto deals”

Although Gallego was one of the two Democrats who voted to pass the bill from the committee, he saidAt the price increase hearing in MaySaid the bill needed “practical and enforceable moral standards,” and he did not guarantee that the bill would get a vote in the full Senate.

Although Trump's disclosure provided Democrats with a clear figure to base their call for a moral agreement, it didn't fundamentally change the debate over the provision. Democrats — including Gallego and Angela Olsobrooks, the only other Democratic Senator on the committee to vote for the bill — have made it clear that they will only agree to vote for the bill in its entirety after reaching an agreement that limits the profits of senior government officials, such as the president, from profiting from cryptocurrencies. Negotiators still need to reach an agreement, and Trump still needs to sign the agreement regardless of the disclosed results.

The agreement itself will probably be one of the last few pending matters after the various drafts have been harmonized.

Another important incident that occurred last week was the US Supreme Court ruling that the president can fire commissioners of independent agencies at will. One source said that one of the demands put forward by the Democratic Party during the “clarity” negotiations was for Trump to appoint a group of members composed of both parties to fill positions in the Securities and Exchange Commission and the Commodity Futures Trading Commission. That requirement still exists.

There are broader issues that could hinder Clarity. An individual concerned about the negotiations pointed out that it is difficult for the US House of Representatives to make substantial progress in dealing with even procedural issues.

Both Punchbowl News and Politico reported on the House's woes last week.Politico's Calen Razor reportsHouse and Senate majority leaders' “pre-election to-do lists” are becoming increasingly difficult to implement. andPunchbowl's Jake Sherman presentation“The House of Representatives is in an extremely chaotic state of paralysis.”

The House of Representatives is currently considering a possible third harmonized budget bill, but the Politico report indicates that the bill still faces some hurdles that need to be overcome. Even if the Senate and House of Representatives pass the bill, it is reasonable to question whether it will be signed by Trump. As of press time, he had not signed the bipartisan housing bill passed by Congress last month, and previously said he wouldn't sign it untilCongress passed a voting ID bill. CongressionalThe bill was sent to Trump early last week. If he hasn't taken any action after 10 daysThe bill became lawExecute automatically.

The Senate is weighing factors in the House, and one of those familiar with the matter said this sense of dysfunction may be weakening their sense of urgency in these negotiations.

The next notable date is August 7, 2026, the last day of the Senate term, after which all members will leave for summer vacation and election season. Although Congress will meet within a few weeks of September, there are other priorities to be addressed, including the National Defense Authorization Act, as previously indicated in this newsletter.