- CFTC Chair Michael Selig urged Congress to pass the Clarity Act before regulators write crypto rules themselves instead of lawmakers.
- Senate negotiations continue as Cynthia Lummis discusses ethics, decentralized finance, stablecoin provisions, and bipartisan priorities remain unresolved before recess begins.
- Galaxy Research lowered passage odds while law enforcement questioned developer protections under Section 604, citing oversight gaps.
U.S. Commodity Futures Trading Commission Chair Michael Selig has urged Congress to pass the Clarity Act, warning that regulators will end up writing digital asset rules if lawmakers fail to approve the legislation. He said the industry cannot continue operating without a clear federal framework as the Senate’s legislative window narrows before the August recess.
Speaking in an interview with Fox Business, Selig said Congress has a chance to establish long-awaited market structure rules. According to Selig, lawmakers should complete the legislation instead of leaving regulators to fill the legal gaps through agency rulemaking.
The House approved the Clarity Act in July 2025, while the Senate continues negotiating its own version. Lawmakers had hoped to release updated legislative text around the July 4 holiday. However, that deadline passed without an agreement, leaving less time before the Senate begins its August recess.
“We’re so close. We have to get this done,” Selig said. He added that regulators would otherwise end up “writing all the rules” instead of Congress defining the industry’s legal framework.
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Political disputes continue delaying Senate negotiations
Selig said the digital asset industry still operates under a patchwork of state laws because Congress has not adopted uniform federal standards. Moreover, he argued that nationwide rules would provide greater legal certainty, stronger consumer protection, and clearer compliance expectations for businesses.
According to Selig, negotiations have expanded beyond the bill’s original market structure goals. He said Democratic lawmakers have pushed to include ethics provisions involving President Donald Trump, his family, and their cryptocurrency ventures.
Selig argued those additional debates have slowed bipartisan progress on legislation that could establish regulatory certainty for digital assets. Consequently, he urged lawmakers to remain focused on the bill’s core objectives instead of unrelated political disagreements.
Meanwhile, Senate Digital Asset Subcommittee Chair Cynthia Lummis said lawmakers have negotiated the Clarity Act since last Labor Day. She explained that discussions have covered decentralized finance, illicit finance safeguards, ethics provisions, and stablecoin-related issues requested by banking organizations.
Additionally, Lummis said lawmakers initially planned to release legislative text around the July 4 holiday before advancing the measure later this month. That timeline has slipped as negotiations continue.
Analysts lower expectations as concerns grow
Outside analysts have become more cautious about the bill’s prospects as negotiations continue. Galaxy Research lowered its estimated probability of Clarity Act passage in 2026 to 50% from 60%, citing Senate calendar constraints and limited negotiating progress. Similarly, TD Cowen said passage before the November midterm elections remains uncertain because several political and policy issues remain unresolved. The firm noted that lawmakers still face significant obstacles before reaching a final agreement.
Law enforcement organizations have also raised concerns about Section 604, known as the Blockchain Regulatory Certainty Act. They argue protections for non-custodial developers could create oversight gaps and complicate investigations involving illicit financial activity. Those concerns have added another layer to the Senate’s ongoing negotiations, even as supporters continue pushing for a comprehensive federal framework that clearly defines digital asset oversight.
Congress now faces increasing pressure to resolve the remaining disagreements before the Senate’s legislative calendar tightens further. Selig’s warning underscores growing industry concerns that regulators could shape future crypto rules unless lawmakers approve the Clarity Act.
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