The Senate Banking Committee will hold its long-awaited markup of the Digital Asset Market Clarity Act of 2025 on Thursday, May 14, 2026. The executive session ends months of delay and sets up what supporters hope becomes the most consequential crypto regulatory vote in Senate history.
Committee Chairman Tim Scott is aiming to complete markup before May 21, when the Senate breaks for Memorial Day recess. The White House has set a target of July 4, 2026, America’s 250th anniversary, for the President to sign the bill into law.
What is the CLARITY Act?
The CLARITY Act, formally the Digital Asset Market Clarity Act of 2025 (H.R. 3633), is one of the most extensive federal attempts to create a consistent framework for cryptocurrency regulation. It establishes clear criteria for classifying digital assets, splitting jurisdiction between the SEC (for securities) and the CFTC (for digital commodities). The bill also incorporates the Anti-CBDC Surveillance State Act, which would prohibit the Federal Reserve from issuing a central bank digital currency directly to individuals.
Supporters argue the legislation would replace years of regulation-by-enforcement with standardized definitions and compliance rules, giving exchanges, issuers, and consumers the legal certainty the industry has called “existential” to its future in the United States.
How the bill got here
- May 29, 2025: Introduced by House Financial Services Chairman French Hill (R-Ark.) with bipartisan sponsorship.
- July 17, 2025: House passed the legislation 294–134, a strong bipartisan margin with 78 Democratic votes in favor.
- September 2025: Bill referred to the Senate Banking Committee; initial September 30 markup pushed back over Democratic objections.
- January 14, 2026: Banking Committee postponed scheduled markup after Coinbase CEO Brian Armstrong publicly pulled the exchange’s support over stablecoin yield provisions.
- January 27, 2026: The Senate Agriculture Committee passed its version of the CFTC-related portions of the bill.
- May 1, 2026: Senators Thom Tillis (R-N.C.) and Angela Alsobrooks (D-Md.) released a compromise text on stablecoin yield, the bill’s biggest remaining hurdle.
- May 8, 2026: Committee officially scheduled the markup for May 14.
The House vote margin represented the highest level of bipartisan agreement on crypto legislation Congress has ever produced, reflecting a sharp shift in political attitudes toward digital asset regulation.
The stablecoin yield fight
The Tillis–Alsobrooks compromise is the centerpiece of the current debate. It bars crypto firms from paying yield on stablecoin balances in any manner “economically or functionally equivalent to the payment of interest or yield on an interest-bearing bank deposit.” Simply holding USDC or USDT would not generate interest-like returns.
Activity-based rewards, those tied to actual transactions, payments, governance, validation, or platform use, remain permitted. The deal forces firms to restructure rewards programs from a “buy and hold” model to a “buy and use” model.
Crypto companies including Coinbase and Circle endorsed the compromise within hours. However, banking groups did not. Five major trade associations, the American Bankers Association, the Bank Policy Institute, the Consumer Bankers Association, the Financial Services Forum, and the Independent Community Bankers of America, issued a joint statement rejecting the compromise, warning that balance-based rewards still resemble deposit interest and could trigger deposit flight. The coalition cited research claiming yield-earning stablecoins could reduce consumer, small-business, and farm loans by one-fifth or more.
Tillis pushed back publicly, suggesting some factions in traditional finance simply want to kill the bill. “Some in the banking industry may not want either of these things to happen, and we respectfully agree to disagree,” he said.
What the committee is voting on May 14
The markup determines whether the CLARITY Act advances to the full Senate. A favorable vote would not enact the legislation but would mark a key procedural step. Committee members will examine, debate, and vote on the bill text and any proposed amendments.
Senator Kirsten Gillibrand (D-N.Y.) has called for an ethics provision barring senior government officials and their families from profiting off the crypto industry while regulating it. “There will be no one voting for this bill if we don’t have an ethics provision,” she said at Consensus Miami 2026. Her office cited a CoinDesk-commissioned poll showing 73% of registered U.S. voters believe senior officials should not have business ties to the industry. The ethics language is widely expected to be absent from the Banking Committee’s version of the bill.
Senators Cynthia Lummis (R-Wyo.) and Bernie Moreno (R-Ohio) have both warned that failure to clear committee before the May 21 Memorial Day recess could push the next viable legislative window to 2030 or beyond.
What happens next
If the Banking Committee approves the bill, the Banking version must first be reconciled with the Senate Agriculture Committee’s January version to create one final Senate text. That combined bill would then need to clear a full Senate floor vote requiring 60 votes, meaning at least seven Democrats would need to join Republicans. The final Senate text would then need to be reconciled with the House-passed bill before reaching the President for signature.
The Senate must act before the end of 2026 for the bill to become law in this Congress. The crypto industry is pushing for passage ahead of the November midterms, when a Democratic House takeover could put the legislation’s future in jeopardy. Prediction markets currently price the odds of the CLARITY Act becoming law in 2026 above 60% as of this writing.
Whether the CLARITY Act ultimately becomes law will depend on bipartisan support, political timing, and growing pressure from the crypto industry to establish clearer rules before the 2026 election cycle reshapes Washington.
FAQ
When is the Senate Banking Committee voting on the CLARITY Act?
The Senate Banking Committee is holding its markup of the CLARITY Act on Thursday, May 14, 2026 at 10:30 a.m. ET in Room 538 of the Dirksen Senate Office Building. The executive session will see committee members debate the bill text, consider proposed amendments, and vote on whether to advance the legislation to the full Senate. Chairman Tim Scott is aiming to complete markup before the May 21 Memorial Day recess. A live video feed of the proceedings will be available to the public.
Did the CLARITY Act pass the House?
Yes. The House passed the bill on July 17, 2025 with a bipartisan vote of 294–134, including 78 Democratic votes in favor. The margin represented the strongest bipartisan support any major crypto bill has received in Congress. The Senate must now pass its own version, which would then need to be reconciled with the House text before reaching the President’s desk.
What is the stablecoin yield compromise?
The Tillis–Alsobrooks compromise, released May 1, bans crypto firms from paying yield on idle stablecoin holdings in any manner economically equivalent to bank deposit interest. It does permit rewards tied to actual transactions, governance, validation, staking, or platform use, forcing firms to restructure from a “buy and hold” to a “buy and use” model. The deal was the breakthrough that revived the bill after months of deadlock and prompted Coinbase to re-endorse the legislation. Five major banking trade associations have publicly rejected the compromise, arguing balance-based rewards still resemble deposit interest.
What happens if the Banking Committee approves the CLARITY Act?
The Banking Committee text would first be combined with the Senate Agriculture Committee’s January 2026 version to create one unified Senate bill. The full Senate would then need to pass that combined text with at least 60 votes, meaning seven or more Democrats would have to join Republicans. The final Senate-passed bill would then need to be reconciled with the House-passed version from July 2025. Only after both chambers approve identical text does the bill reach the President for signature.
When does the White House want the bill signed?
The Trump administration is targeting July 4, 2026, America’s 250th anniversary, for the President to sign the CLARITY Act into law. White House Executive Director of the President’s Council on Digital Assets Patrick Witt confirmed the target at Consensus Miami 2026. The timeline requires the Senate Banking Committee to advance the bill in May, the full Senate to vote in June, and the House to either accept the Senate version or quickly reconcile differences. Senators Lummis and Moreno have warned that failure to clear committee before Memorial Day could push the next viable window to 2030 or beyond.
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