The Senate has entered what could be its final practical window to advance the CLARITY Act this year, with a merged draft expected as early as next week before lawmakers run out of time ahead of the August recess. Summary Senate negotiators are preparing a merged CLARITY Act draft ahead of a possible floor vote later this month. Democratic support remains uncertain as lawmakers continue talks over ethics rules, DeFi protections, and stablecoin provisions. The White House has denied blocking Democratic SEC and CFTC nominees as regulatory appointments become part of the debate. According to a CoinDesk report, Senate negotiators are preparing updated legislative text that combines proposals from the Senate Banking and Agriculture committees into a single version of the crypto market structure bill. The report said the draft is expected to add more than 70 pages of new material and place stronger focus on consumer protections alongside revisions negotiated over recent weeks. With the Senate targeting possible floor action during the week of July 20, the legislative calendar has become increasingly compressed. Debate on the bill could take several days, leaving lawmakers with only a narrow period before the chamber begins its summer recess and attention turns toward the fall midterm campaign season. The CLARITY Act would establish a federal framework for digital asset markets by defining how regulatory authority is divided between the Securities and Exchange Commission and the Commodity Futures Trading Commission. While the House approved its version of the legislation with bipartisan backing in 2025, the Senate has continued negotiating key provisions before bringing the measure to a vote. Democratic support remains the biggest hurdle Despite progress on the draft, the legislation still lacks the bipartisan backing needed to clear the Senate’s 60-vote threshold. According to CoinDesk, Democratic support remains uncertain as negotiations continue over several unresolved issues. One of the largest sticking points is an ethics provision backed by Democratic lawmakers. The proposal would prevent senior government officials, including the president, from maintaining business interests connected to the cryptocurrency industry. Several senators have indicated they cannot support the final bill unless an agreement is reached on those restrictions. CoinDesk also reported that the ethics debate is only one part of a broader negotiation. Outstanding issues still include Senate Agriculture Committee concerns, law enforcement requests involving legal protections for decentralized finance developers, and disagreements over stablecoin yield provisions. Another section expected to receive fresh attention is federal preemption, which determines how much authority individual states would retain after a nationwide crypto regulatory framework takes effect. Separately, staffing at the SEC and CFTC has become part of the broader political discussion surrounding the legislation. As crypto.news previously reported, the Trump White House rejected claims that it was refusing to nominate Democratic commissioners to either agency. In a letter sent to Senate Majority Leader John Thune and Senate Democratic Leader Chuck Schumer, the administration said it had already requested suitable Democratic nominees for both regulators but had not received any names. Final negotiations continue before Senate debate The appointments dispute has added another layer to negotiations because both the SEC and CFTC would receive expanded responsibilities if the CLARITY Act becomes law. As crypto.news previously reported, lawmakers are already working against the Senate’s Aug. 7 recess, leaving limited time to finalize the legislation. Meanwhile, the decentralized finance industry is watching whether the Blockchain Regulatory Certainty Act remains part of the package. The provision would prevent developers who do not control customer assets from being classified as money transmitters, and support from Senator Ron Wyden has been viewed by industry advocates as a positive development this week. Although negotiators are expected to unveil the merged draft shortly, the report noted that the legislation remains unfinished. The White House has not signed off on the latest version or participated in the most recent negotiations, while enough Democratic votes have yet to be secured for Senate passage. Even if senators approve the revised bill, the House would still need to pass the updated text before it can be sent to President Donald Trump’s desk, leaving several procedural and political hurdles before the CLARITY Act can become law.
