TD Cowen analyst Jaret Seiberg expects the CLARITY Act will not pass this year as conflict-of-interest rules target Trump crypto. Polymarket 58%, Amiom 24%.
TD Cowen analyst Jaret Seiberg warns that the CLARITY Act, the broadest U.S. crypto regulation package, is losing momentum in Washington. Political divisions around a conflict-of-interest clause and recent Trump-related disclosures are pushing the odds of 2026 passage lower. For traders holding assets tied to Trump-linked crypto ventures, the delay means continued regulatory uncertainty.
Section 307 of the bill would block the U.S. president, vice president, and members of Congress from actively trading cryptocurrencies. That provision directly touches Trump-linked ventures including World Liberty Financial, American Bitcoin, and the TRUMP and MELANIA meme coins.
Seiberg argues the provision creates a zero-sum dynamic. Democrats face pressure to demand stricter ethics rules. Republicans grow reluctant to advance a bill that appears to single out Trump. The result is a legislative stalemate where neither side can move without alienating its base.
Democrats may now find it harder to vote for the CLARITY Act without stronger ethics language. Republicans see any amendment targeting Trump as poison for party unity. Seiberg notes this political divide makes the bill's path increasingly narrow.
Recent events have hardened positions further. The IRS settled a dispute with Trump, creating a $1.776 billion anti-weaponization fund and permanently barring audits of Trump family tax returns. Separately, government disclosures showed nearly 3,600 stock trades executed on Trump's behalf during the first quarter of 2026. Some trades reportedly aligned with his public policy comments during that period.
These disclosures give Democratic lawmakers fresh ammunition. Seiberg says Democrats may now find it harder to support the bill without stricter ethics provisions. Republicans, in turn, view any amendment targeting Trump as a party-line rupture.
The anti-weaponization fund and audit ban remove a potential leverage point for Democrats. They can no longer point to ongoing IRS scrutiny. At the same time, the stock trade disclosures provide a new angle for demanding ethics reform. The two events together push the political calculus in opposite directions, freezing progress.
Traders show sharply different expectations. On Polymarket, the implied probability of the CLARITY Act becoming law by end of 2026 sits at roughly 58%. On Amiom, the probability drops to 24% for passage before June 30.
The divergence reflects the market's inability to price the political timeline. Polymarket's longer horizon captures a possible late-year push. Amiom's tighter window implies near-term gridlock is already baked in.
Trump-linked crypto assets carry the most direct exposure. They are explicitly named in the conflict-of-interest debate. World Liberty Financial, American Bitcoin, and the presidential meme coins would lose the safe-harbor or regulatory clarity the CLARITY Act would provide.
Broader crypto markets also face a setback. The CLARITY Act is designed to establish a federal framework for digital asset classification, exchange registration, and stablecoin rules. Without it, token issuers and trading platforms remain under a patchwork of state laws and SEC guidance. That uncertainty typically weighs on valuations, especially for smaller-cap tokens that rely on regulatory clarity to attract institutional capital.
U.S. crypto exchanges and custody providers would also see delayed clarity on capital requirements and customer asset segregation rules. Firms that have already spent millions on compliance infrastructure are betting on a federal standard. A legislative failure leaves them exposed to conflicting state regimes.
Senator Tim Scott remains optimistic, suggesting the bill can pass with bipartisan support. Senator Cynthia Lummis has warned that near-term expectations are “too optimistic.” The prediction market split confirms that traders are not pricing a smooth process.
For traders, the practical takeaway is straightforward. The CLARITY Act is not dead. Its path to law has narrowed. Assets that depend on regulatory clarity should be sized with the understanding that a 2026 passage is no longer a base case. Monitor the Senate Banking Committee calendar and any public comments from Trump or Democratic leadership on Section 307. A clear statement either way will break the stalemate faster than the legislative process itself.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.