CLARITY Text Just Dropped… Here’s Where Everybody Sits

The CLARITY Act text went public Wednesday afternoon, and in the hours that followed, we saw a wave of telling responses.

These responses largely fall into three camps…

There are those who are generally optimistic and press a sense of urgency to move things along. There are the pessimists who say the current ethics language in the bill is insufficient.

And then there’s camp three… those I consider the realists.

We’ll get into each of the camps in just a moment. But for those not caught up on what the CLARITY Act is, here’s a quick rundown.

The bill is a framework for digital assets. It sets out guidelines for those in the industry on what they can and cannot do. It’s a piece of text that’s been needed for the industry to feel comfortable operating and essentially reshoring within the United States.

That’s because Washington, D.C., was hostile towards digital assets prior to President Trump taking office.

Senator Elizabeth Warren was platforming during her re-election campaign on the creation of an anti-crypto army. Former Chair of the Securities and Exchange Commission (SEC) Gary Gensler opened dozens of cases against crypto-related entities, regulating the industry via enforcement. And most importantly, “legislation” in Congress offered little more than opportunities for negative sound bites with limited good-faith attempts to actually form clear regulations.

The swamp was even successfully keeping crypto-related companies out of the banking system in what has since been called Operation Chokepoint 2.0.

It was an all-out war against the industry. Developers, teams, and projects fled overseas.

That was until the new administration entered the office. I covered the change in sentiment well before the President took the oath of office in essays like Washington D.C. Puked over at The Bleeding Edge.

Since the change in sentiment, it’s been a continual progression to the point where on July 31, 2025, the new chairman of the SEC, with support from the White House and the CFTC, introduced Project Crypto… An initiative to put America’s financial system onchain. It’s been a complete reversal in stance.

Progress has been so constant that we’re waiting on the last remaining piece, legislation such as the CLARITY Act, to make all this positive momentum a permanent standard for blockchain technology.

This could be huge for the industry, and it’s something we in the industry have been tracking and anticipating for a long time. We will likely be writing about the topic for the next few issues as we watch the situation play out and potentially see the battle to bring our financial system onchain finally come to a head in D.C.

We are mere days away from seeing the Senate vote on the bill, one that has already passed the House of Representatives. Meaning we are getting incredibly close to a pivotal moment that can act as a catalyst for the market, as we laid out in Wednesday’s issue, The Market Is Primed For CLARITY.

As for where we stand in the days since the text was introduced…

The Yeas

This camp was always going to vote in favor of the 700-page bill.

It’s almost all the Republicans. Many echo the sentiment that we need to make America the home for innovation. They are also pointing to progress made in other countries in writing laws around digital assets well before the United States.

Much of the rhetoric is around staying competitive.

Senator Cynthia Lummis (R-WY) was already seen on Fox Business discussing the bill and its positive implications.

There’s also a strong push happening by the White House, with Patrick Witt – the Executive Director of the President’s Council of Advisors for Digital Assets – stating the case for CLARITY wherever he can.

And even Goldman Sachs CEO David Solomon came out in support of the bill. This marked a stark split from banking trade groups who have been very against the bill.

We expected the Republican support, and got an added benefit of banking support.

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The Nays

There are currently no Democrats in favor of the text as it stands.

The first bucket of Democrats is Senators who are against the bill. This includes the usual suspects such as anti-crypto army Senator Elizabeth Warren and several others. These are the constant pessimists of the group who have been fighting it tooth and nail every step of the way. Frankly, nothing will change their minds.

But there is a group of pro-crypto Democrats who have generally favored a legislative framework for crypto and blockchain, but they have come out in opposition to the way the text is currently written.

This includes individuals like Cory Booker (NJ), Gallego (AZ), Hickenlooper (CO), Warner (VA), Warnock (GA), and the two Democrats who voted in favor of the bill in committee – Alsobrooks (MD) and Gallego (AZ).

This is the main group to watch. They’re the swing votes and represent a group that is open to negotiations. They are most likely to change their tune once the bill hits the floor.

I’ve personally sat next to and witnessed speeches from politicians like Cory Booker who fully support the values of public and permission technology.

This group’s main issue is around the proposed ethics language – a valid concern given some questionable ethical issues around some of the Trump family’s crypto dealings, which we’ve discussed before.

From reading the section of the bill as it relates to ethics, there is room for the President and Republicans to give a little to make a deal happen.

What I was worried about was President Trump and Republicans putting forward what might be considered exceptionally strong language without room for negotiation. But the way it’s written, the text can and likely should go a step further. With some revision, I believe the bill will move to a vote.

At the end of the day… Senator Cynthia Lummis sums up the pro-crypto Democrats’ stance best…

 A lot of Democrats are absolutely focused on one person, President Trump… They are so focused on getting a pound of flesh from President Trump.

I think the Democrats who have been openly working with Republicans to get this bill passed will get their small victory here. It might not be a pound of flesh, but enough for them to feel like they got a small win.

The ironic part of all of this is that the Democrats no longer want the President to continue what he’s doing as it pertains to profiting off crypto, but there are currently no definitive laws against what he does now… Which is to say, if the CLARITY Act doesn’t pass, nothing changes here.

It would almost be acting against their own interests to not vote in favor of it.

This is all to say, there is a significant motivation for this group to get the bill passed despite what most are vocalizing. It just needs some revision to the ethics guidance, which we’ve acknowledged a number of times would likely be the ongoing point of contention.

Plus, there’s something else that is influencing the politics…

The Reality

Crypto political action committees (PACs) are no joke.

They were very active in the 2024 elections. Estimates place spending at $196 million in the prior election cycle.

The results? Nearly every candidate backed by crypto lobbyists won. There were a few instances where they didn’t, such as Senator Elizabeth Warren in Massachusetts and a North Carolina House primary race.

But the other races? Successful. They were even successful in removing strong crypto-critic Senator Sherrod Brown (D-OH), spending $40 million on the effort.

Which is to say, if this bill does get to the floor for a vote, the fear of the crypto PAC will influence the vote.

That’s because crypto PACs are even larger. For the 2026 midterms, PACs have spent nearly $200 million already. It will far surpass what was spent in 2024 even though this is not a presidential election cycle.

What’s more… The largest PAC, Fairshake, already boasts a 38-2 record across the first 40 congressional races it’s spent money on this year.

This reality means any candidate voting “Nay” on the record is putting a target on their back. I wouldn’t be surprised to see a lot of Senators in the pessimistic camp change their tune once it’s time for a vote.

That’s the reality.

Whether you like the fact that money matters in politics or not, the reality is politicians need it to win elections.

This is why I’m leaning towards it passing if the CLARITY Act gets to the floor of the Senate for a vote, based on what we saw in the hours after the release of the text.

Said another way…

I think the odds good that this Polymarket market will change in the coming week.

We will continue to follow this closely in the coming days to help you stay informed on what is one of the most exciting moments in the industry.

Your Pulse on Crypto,

Ben Lilly
Editor, Chain of Thought