Senate Democrats Submit Last-Minute Counteroffer on CLARITY Act

Republican sponsors, led by Senators Cynthia Lummis, Tim Scott, and John Boozman, argue that their latest 635-page draft already integrates 126 substantive changes requested by Democrats. The proposal includes revised ethics restrictions for high-ranking officials and their families, mandating divestment or blind trusts for certain digital asset holdings. Despite these concessions, some Democratic senators remain skeptical that the current framework sufficiently addresses potential conflicts of interest.

Simultaneously, the legislation faces pressure from the banking sector. The American Bankers Association and various community banking groups are lobbying for stronger restrictions on stablecoin rewards, fearing that interest-like incentives will drain essential deposits from traditional lenders. While the current bill grants the Treasury secretary authority to investigate detrimental impacts on small banks, industry groups contend the process is too slow to prevent deposit flight. Adding to the complexity, a coalition of 18 state attorneys general has warned that the bill could inadvertently undermine state-level powers to prosecute crypto fraud and securities violations. With Republicans holding 53 seats, the success of the 2:15 p.m. cloture vote depends on bridging these partisan and industry-driven divides to secure the necessary Democratic support.