CLARITY Act Odds Drop to Record 32% on Polymarket

Traders on the prediction market Polymarket now give the CLARITY Act just a 32% chance of becoming law by the end of 2026. That is the lowest reading since the contract launched back in January.

The CLARITY Act is meant to draw a clear line between SEC and CFTC authority over digital assets in the US, replacing years of regulation through enforcement with rules written by Congress. A Senate vote could have come as soon as next week, but lawmakers still have no deal on an ethics provision for officials holding crypto assets.

The reading fell from 82% to 32% in half a year

The Polymarket contract launched on January 11, when traders gave the bill roughly a 62% shot. By February 19 the odds climbed to a peak of 82%, with participants betting bipartisan support was nearly locked in. Then the slide began.

Since early May the line has moved almost only downward. The Senate's legislative calendar narrowed, and doubts grew over whether lawmakers could line up enough votes. On Friday, July 17, the reading dropped to 32%, which is 30 percentage points below the starting level.

For the industry, this contract has become an informal barometer. Exchanges, custodians and some institutional investors watch it to gauge when new US licensing rules might actually land. The drop from 82% to 32% reads as a signal: the fall deadline may not hold.

The ethics clause stalled the vote

The main obstacle is the position held by part of the Senate's Democratic caucus. Sen. Ruben Gallego of Arizona, one of two Democrats who voted to advance the bill out of the Banking Committee, has repeatedly said he won't back it on the floor without a bipartisan ethics provision.

The bill has already cleared both the Senate Banking and Agriculture committees. The two panels hold jurisdiction over different corners of the digital asset market. Earlier this month lawmakers were drafting updated text they planned to release the following week, though it still hadn't won Democratic backing.

Gallego sits on the Banking Committee and has previously said publicly he would only back the bill if no sitting or future federal official could personally profit from digital assets while in office. That specific demand is the part still missing concrete language both parties can accept.

Democrats' concerns aren't abstract. In June, President Trump disclosed $1.4 billion in earnings tied to crypto ventures, including his own memecoin and World Liberty Financial. Sen. Elizabeth Warren this week asked him for annual reporting on such earnings through 2027, citing the debate over this very bill.

On Thursday the president met with Senate Republicans at the White House, while Democrats held their own separate meeting the day before. There has been no public readout of either conversation.

What the industry is saying

Summer Mersinger, CEO of the Blockchain Association and a former CFTC commissioner, spoke at the Injective Summit in Washington on Thursday. She said lawmakers were already very close on the main text, with only small details still being worked out.

"Ethics is the big elephant in the room. That's what we hear from every office, that we've got to figure out ethics. Whatever they decide on that piece, that's politics, that's Congress. But please don't let it kill all the hard work put into the rest of the bill."

- Summer Mersinger, CEO of Blockchain Association, remarks at the Injective Summit in Washington, July 16, 2026

Per Mersinger, a Senate vote could have come as soon as next week if Republicans and Democrats reach an agreement before the August recess. Time is running short.

On Friday the House held a hearing marking one year since it passed the bill. That milestone was a reminder that its own version has been sitting with the Senate for a full year already. At the hearing, industry representatives again argued that clear SEC and CFTC jurisdiction would pull back into US-regulated territory activity that currently runs through offshore venues.

The numbers in one place

What changes for the market if the bill passes

The CLARITY Act would, for the first time at the federal level, split digital assets between SEC and CFTC oversight, answering which tokens count as securities and which as commodities. Backers argue it would replace years of regulation by enforcement with rules written into law.

For stablecoin issuers and custodians, a clear split in jurisdiction would mean less legal uncertainty when launching new products in the US. Right now some firms would rather register in Europe under MiCA, or push part of their operations offshore, while US rules stay blurry.

For large players, clarity mostly matters for operating inside the US itself. Centralized exchanges and custodians are waiting on clear licensing rules so they can expand services for institutional clients without risking a new SEC lawsuit. Kurslog previously covered how senators and banks publicly opposed parts of this same bill in a piece on senators and banks pushing back on the US crypto market bill.

• If there's no ethics deal by the end of July, the vote could slip to the Senate's fall session.
• Democratic support hinges on conflict-of-interest concerns tied to officials' crypto holdings, not on the bill's technical details.
• The industry warns a delay would stretch the era of regulation by enforcement out by several more months.
• At publication time Bitcoin traded near $64,000, having recovered after dropping below $62,500 on Iran strikes earlier this week.

What comes next

Next week will test whether the Senate can settle the ethics question before the August recess. The industry is asking lawmakers not to sink the whole bill over one clause, Democrats are holding out for conflict-of-interest safeguards, and the prediction market isn't betting on a quick resolution.

If there's no deal this summer, the next real shot at a vote won't come until the fall. Polymarket's odds are unlikely to climb again before concrete ethics language actually appears. Until then, every quiet week out of the Senate will most likely keep pushing the contract's reading lower.

There's a risk rarely spoken about out loud: if the Senate misses this year, the relevant committees will most likely have to rebuild their vote count from scratch in the next Congress. For companies and lobbyists who spent years shaping the text, that would mean starting negotiations almost over again.