The opportunity to pass the CLARITY Act before the year ends is shrinking, according to JPMorgan strategists, as Congress juggles a busy agenda and clashes over specific terms. Analysts led by Nikolaos Panigirtzoglou highlighted that the approach of the 2026 midterm elections is compressing the timeline for lawmakers to finalize major digital asset rules, potentially pushing market structure reforms into next year.
This legislation aims to create a federal system for overseeing digital currencies, splitting duties between the Securities and Exchange Commission and the Commodity Futures Trading Commission. Although the bill has advanced to the Senate floor, it still needs a full Senate vote, reconciliation with a House version, and presidential approval. The analysts cautioned that the bill’s final form could shift dramatically depending on political changes, especially if the midterm elections alter party control.
A key sticking point remains stablecoin regulations. JPMorgan noted that banking industry pushback has intensified over provisions allowing returns on stablecoin balances, which some argue could sidestep traditional banking safeguards. Jamie Dimon, JPMorgan’s CEO, and Citigroup’s David L. Cohen have voiced opposition, claiming the bill might create regulatory loopholes. Dimon specifically criticized crypto firms for potentially offering deposit-like products without equivalent protections, and questioned the bill’s coverage of anti-money laundering and Bank Secrecy Act requirements.
Senator Cynthia Lummis responded sharply, asserting that the legislation already incorporates AML and BSA rules. She accused Dimon of either not reading the bill or deliberately misleading the public. Lummis, who leads the Senate Banking Subcommittee on Digital Assets, remains engaged in negotiations but acknowledged that a vote might not happen until after the July 4 recess, with August being more realistic.
In addition to stablecoin rules, the bill includes developer protections from the Blockchain Regulatory Certainty Act, which would exempt decentralized software developers from being treated as money transmitters if they don’t hold customer funds. Support for this has grown, with Defend Developers launching a PAC and the Blockchain Association gathering a letter from 160 former officials urging passage. Despite this backing, Lummis admitted that securing the 60 votes needed for cloture could still be challenging.