Hope springs eternal.
Yesterday, Senate leadership decided they did not have sufficient support to hold a floor vote on the CLARITY Act, key crypto market infrastructure legislation that aims to protect consumers while enabling digital asset innovation.
The Crypto Council for Innovation (CCI) expressed their disappointment a potential vote will now be pushed to September, when the Senate is back in session.
“There has been tremendous progress on the Clarity Act thanks to the efforts of so many. While the postponement is disappointing, the direction has not changed. CCI remains committed to ensuring the U.S. enacts comprehensive market structure legislation that protects Americans. Every day without such a framework pushes American users and builders offshore and leaves consumers at risk. Our efforts will not stop here. CCI will keep working with Senators on both sides of the aisle, their staff, and the Administration until the Clarity Act is signed into law,” said Hun Kim, CCI CEO.
Coinbase CEO Brian Armstrong, one of the strongest voices supporting the legislation said that both sides, the crypto industry and banking sector, had compromised, and the main obstacle was some group trying to block or stall legislation.
While some Republicans were pushing for vote, even if it was defeated, it would get people on the record. Punchbowl News reported that Democrats were warning Republicans if they did this, they would kill the bill which caused the Republicans to “blink.”
James Thorne, Chief Market Strategist at Wellington Altus, explained that the delay was clear win for Senator Elizabeth Warren, who does not support crypto innovation. “The progressive left anti innovation team wins again,” said Thorne.
“In this fight, the Democrats have chosen to be anti‑innovation, defending yesterday’s institutions at the expense of tomorrow’s growth. The level of incompetence required to reach this point, an innovation superpower choosing delay and spite over strategy, is historic. Another own goal.”
Politics, Not Policy.
The fact of the situation is that politics, not policy, is undermining much needed digital asset rules.
For the banking industry which has lobbied hard against the CLARITY Act, it is the fear of competition. They do not to see a challenge to their top and bottom line. By creating bright line rules for the digital asset sector, banks will have to update and innovate too and provide better services to customers. Banks would rather keep a regulator moat to protect their business to the detriment of innovation.
On the left, it is all about control and gaining an edge on the upcoming midterms. A win for the White House and the Republicans could cost them votes. Again, to the detriment of consumers and businesses.
In the end, everyone loses. America has an opportunity to define the digital asset sector globally. As the US dominates financial services worldwide, this is important for the economy.
While crypto supporters have not yet declared defeat, and September is weeks away, the whole saga highlights the shortcomings of the legislation making process, where what makes sense is lost in the political score.
