Clarity Act hits snag in Senate, passage could be delayed past 2030

The CLARITY Act has hit a snag ahead of a full Senate vote due to renewed disagreements between Republicans and Democrats, CryptoSlate reported. The dispute centers on a provision that would grant state attorneys general the authority to sue the Department of Justice. Republicans are pushing to remove the clause, citing constitutional concerns about state officials suing federal counterparts. In contrast, Democrats argue it is a necessary safeguard in case a crypto-friendly administration comes to power. While the bill passed the Senate Banking Committee's markup session in May with a 15-9 vote, it requires at least 60 votes to clear the full Senate. This means that even with full Republican support, at least seven Democratic votes are needed. Some Democratic senators who previously voted in favor during the committee stage have indicated they will vote against the bill unless the ethics provision issue is resolved. Industry observers have raised concerns that if a floor vote is not scheduled before the congressional recess in August, the bill's passage could be delayed beyond 2030. The outlet added that several other issues remain unresolved, including anti-money laundering (AML) regulations, the definition of DeFi protocols, the permissible scope of interest on stablecoins, and the process of merging the Senate Banking and Agriculture Committee versions of the bill.