Senate Republicans released an updated version of the Crypto CLARITY Act. The new draft follows negotiations held during the August recess.
The legislation introduces new requirements for decentralized finance platforms. It also clarifies provisions covering credit unions’ digital asset activities.
However, the revised text has not secured sufficient Democratic support. The bill needs at least 60 Senate votes to advance.
The Senate will return from its August recess next week. The first critical vote will take place on Tuesday, September 15.
New draft released for the Crypto CLARITY Act
Republican senators circulated the updated legislative text on Thursday. Most of the draft retains the structure of previous versions.
However, the new text introduces additional requirements for decentralized finance entities. These provisions explain when DeFi projects must register with regulators.
The draft could also place some DeFi projects under the Commodity Futures Trading Commission. In short, the CFTC could gain broader authority over digital commodity transactions.
Certain projects could also face requirements under the Bank Secrecy Act. Consequently, these entities may need to comply with anti-money laundering rules.
Meanwhile, the new provisions only target spot market transactions. The draft excludes prediction markets from these regulations.
Digital asset rules for credit unions become clearer
The revised text also changes provisions covering traditional financial institutions. In particular, it provides clearer rules for credit unions’ crypto activities.
These institutions offer financial services as an alternative to conventional banks. However, current regulations create uncertainty around their digital asset services.
The new draft defines the role of credit unions more clearly. Therefore, these institutions could approach custody and other crypto services with greater certainty.
Republican Senator Cynthia Lummis said negotiators incorporated more than 114 requests into the text. According to Lummis, Democratic senators submitted those requests.
Lummis believes the legislation could provide lasting regulatory certainty for digital asset companies. Moreover, it could reduce policy swings following changes in presidential administrations.
Crypto bill must secure 60 votes
The Senate will hold its first procedural CLARITY Act vote on September 15. The bill needs support from 60 senators to advance.
Therefore, Republicans must persuade several Democratic senators to support the legislation. However, disagreements over ethics rules remain unresolved.
Democrats want stronger restrictions covering senior government officials. Their demands particularly focus on President Donald Trump’s crypto ties.
Some Democrats have refused to support the bill without a bipartisan ethics provision. Meanwhile, the White House has not shared detailed comments on the current draft.
Stablecoin rewards also remain a major issue in the negotiations. Banking groups want lawmakers to impose tighter restrictions on these rewards.
Banks argue that stablecoin yields could accelerate withdrawals from traditional deposits. However, the crypto industry opposes broad restrictions.
Consequently, the current draft may not become the final compromise. Negotiations could continue after the first procedural vote.
If approved, the CLARITY Act would establish a comprehensive US crypto regulatory framework. It would also define the jurisdictional boundaries between the SEC and CFTC.
