Circle Internet Group Inc. (NYSE:CRCL) CEO Jeremy Allaire says lawmakers are close to resolving the remaining disputes over the CLARITY Act, even after its Senate defeat hammered crypto stocks and sent prediction market odds of passage into single digits.
“We’re at like the 90% mark on all of that stuff,” Allaire told CNBC Wednesday, referring to disputes over crypto exchanges, ethics provisions and legal protections for DeFi developers.
Allaire pointed to the GENIUS Act, last year’s stablecoin law, which also failed an initial procedural vote before advancing 11 days later.
Traders are less confident lawmakers can repeat that turnaround. Polymarket gives CLARITY a 7% chance of becoming law in 2026, with about $21.3 million traded.
The Senate failed to advance the bill Tuesday after falling short of the 60 votes needed. Circle fell 8.9%, while Coinbase Global Inc. (NASDAQ:COIN) dropped 5.9%. Bitcoin (CRYPTO: BTC) also fell sharply.
Why CLARITY Matters to Crypto Stocks
For Coinbase, CLARITY addresses a question that has hung over its core business for years: which digital assets are securities, which are commodities and what rules crypto trading platforms must follow.
The issue also matters to Robinhood Markets Inc. (NASDAQ:HOOD), which has expanded aggressively into crypto and says the U.S. still lacks a clear federal registration path for crypto platforms.
Circle is less directly exposed. “We have settled federal law. We have the GENIUS Act,” Allaire said.
GENIUS established federal rules for stablecoins. CLARITY would govern much of the wider crypto market in which Circle wants USDC used.
More USDC in circulation means more reserve income for Circle. Reserve income accounted for 95.2% of second-quarter revenue, according to a regulatory filing.
‘Wanted This to Fail’
Sen. Angela Alsobrooks (D-Md.), a CLARITY supporter involved in negotiations, told CNBC Wednesday that a deal was still within reach.
“They wanted this to fail for political reasons,” Alsobrooks said, accusing Republican leadership of ending negotiations over ethics provisions.
Republicans tell it differently. Sen. Cynthia Lummis (R-Wyo.) said before the vote that Democrats kept adding demands after Republicans met earlier requests.
“There’s nothing left to give,” Lummis said.
A second vote remains possible. Sen. Thom Tillis (R-N.C.) changed his vote and entered a motion to reconsider, saying on X, “This is not the end for the Clarity Act. We’ve made substantial bipartisan progress in large part because of the White House. This procedural motion allows us to continue working towards a positive outcome.”
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