Clarity Act Faces Major Pushback Ahead of Senate Vote

Lawmakers are facing a three front pushback on the revised Digital Asset Market Clarity Act just hours before a key Senate procedural vote. Republicans released the updated text as a final offer to Democrats, but banking trade groups, state attorneys general, and Senator Elizabeth Warren are all objecting to different parts of the bill.

Eight banking groups wrote to Senate leaders to argue that the stablecoin yield ban still leaves room for interest like payments. Meanwhile, a coalition of 18 state attorneys general led by New York's Letitia James opposed the bill entirely. They warned that federal preemption would strip state registration systems and harm local investor protections.

Senator Elizabeth Warren also rejected the new ethics provisions added by Republicans, calling them weak and full of loopholes for political figures. Despite the heavy opposition, negotiations are continuing behind the scenes, and Democrats sent back a counteroffer late Monday evening.

The upcoming cloture vote requires 60 votes to advance, meaning Republicans need support from at least seven Democrats. Traders and market observers will be watching closely on Tuesday afternoon to see if the updated bill can secure enough votes to move forward.