Arca's David Nage says 80-85% of the CLARITY Act is settled, but ethics rules on officials' crypto holdings could delay a July vote or push action to 2030.
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Negotiations over conflict-of-interest rules are the last obstacle keeping the CLARITY Act off the Senate floor, according to David Nage, managing director and portfolio manager at Arca. After meetings with Senate offices in Washington, Nage said lawmakers and industry representatives are roughly 80–85% aligned on the substance of the Digital Asset Market Clarity Act. The public disagreements, he argued, mask a narrower dispute.
Nage's base case assumes the ethics provisions get resolved and competing Senate proposals get reconciled in the coming weeks. Under that outcome, he expects the bill to reach the floor after Congress returns from recess on July 13. The legislation has already drawn bipartisan support in committee.
Most of the early flashpoints have faded. Stablecoin yield provisions, which JPMorgan Chief Executive Jamie Dimon and other banking critics have opposed, are no longer a major sticking point, Nage said after his meetings. Senate offices largely view that issue as settled.
The debate has narrowed to how to restrict government officials from benefiting from crypto-related business while serving in office. Lawmakers are focused on enforcement mechanics, Nage said. He described the disagreement as a political challenge around implementation and public perception rather than a dispute over digital asset policy.
Nage proposed a uniform prohibition on crypto business activity that would cover the President, Vice President, executive branch officials, and members of Congress. He said the ban should not create exemptions for specific individuals.
The bill also includes enforcement measures aimed at illicit finance. Senator Cynthia Lummis said the CLARITY Act would allocate $150 million to law enforcement agencies for cryptocurrency fraud investigations. Exchanges and stablecoin issuers would be allowed to freeze suspicious transactions for up to 30 days, with authorities able to extend that to 180 days through written orders. Digital asset businesses would face Bank Secrecy Act requirements, including Anti-Money Laundering programs and Suspicious Activity Reports similar to those imposed on traditional financial institutions.
Industry groups are pressing senators to preserve language tied to the Blockchain Regulatory Certainty Act. Kristin Smith, president of the Solana Institute, said the provision would clarify that blockchain developers, node operators, and validators who do not custody customer assets should not be treated as money transmitters under U.S. law. Smith said the language would provide legal certainty for open-source developers and network operators while maintaining a distinction between infrastructure providers and businesses that directly control customer funds. She added that founders, executives, and investors across the crypto industry have urged Senate leaders not to weaken those protections.
Nage also outlined a downside scenario. If lawmakers fail to resolve ethics provisions before the recess, the opportunity to pass the bill during the current Congress could narrow considerably. Lummis has similarly cautioned that failure to advance the bill this session could delay action until 2030.
The market has not priced a material probability of a 2030 timeline, Nage said. A July floor vote would remove that tail risk. The next signal is whether the ethics language gets finalized before the July 13 return date.
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