Departure Wave and Legislative Vacuum: Who Will Steer the CLARITY Act's Next Chapter?
Author: Cleve Mesidor
Compiled by: Chopper, Foresight News
This year's fierce debate over the Digital Asset Market Structure Act (the CLARITY Act) is not aimed at outright rejecting the bill. The essence of this legislative battle is who gets to hold the pen and draft it.
Even Senator Elizabeth Warren, whom the industry regards as crypto's biggest opponent, wants a seat at the rule-making table. In fact, since the Senate version of the bill was voted down in January of this year, the list of groups wanting to take part in drafting the bill has only continued to grow.
On December 11, 2025, Wells Fargo President and CEO Charles Scharf (right) departs after meeting with Senate Banking Committee members at the U.S. Capitol Visitor Center
Coinbase CEO Brian Armstrong said in a recent social media post: 'In January of this year, I opposed sending the draft bill to committee for a vote because it still had a great deal that needed to be improved regarding DeFi, tokenization, CFTC authority, and stablecoin yield provisions. At the time, the draft had serious flaws that would have harmed the crypto industry's interests; support was fragmented across the board, and the bill simply could not pass. We worked with many parties to revise the bill and make it viable for passage. In the new draft submitted to committee about four months later, all four issues I had raised were addressed. I am proud of this work, and if I had to do it again, I would, because it produced a better-quality bill. This is just one step in a long process.'
Ironically, the response of many stakeholders to Armstrong's January move was roughly, 'We want to be involved in revising it too.' All kinds of institutions emerged one after another, claiming they wanted to work together to 'make the bill better.'
Conflicting Demands from Multiple Parties
Banks were the first to object to the revisions Armstrong pushed for, a matter that subsequently led the White House to host several small summits inviting crypto executives and bank executives.
Next, law enforcement raised objections, voicing concerns about developer protections and illicit finance risks.
Disclosure filings in June showed that President Trump had $1.4 billion in crypto asset gains, which sharply increased bipartisan calls for ethics provisions in the bill.
Regulatory experts also kept sounding warnings that both the CFTC and the SEC face vacant commissioner seats.
The political tug-of-war between the legislative and executive branches over the crypto legislative process is also affecting the emerging industry's overall judgment.
Even so, bipartisan lawmakers on the Senate Banking Committee and Agriculture Committee continue negotiations, trying to find compromise solutions and push things forward.
On July 16, 2025, Blockchain Association CEO Summer Mersinger (center) attends a House Ways and Means oversight subcommittee hearing titled 'Building the Global Crypto Capital: Establishing 21st Century Digital Asset Policy' at the Longworth Building
What Happens Next?
It has been nearly two weeks since the CLARITY Act's final vote failed, and the wounds have yet to heal. Policy advocates on opposing sides are still doing post-mortems, and everyone claims their goal is to improve the CLARITY Act.
Some are looking to the lame-duck congressional session after the midterm elections, hoping to revive the bill. Others are pinning their hopes on financial regulators directly issuing rules to fill regulatory gaps. Still others believe the bill is already dead.
But most relevant parties have already been privately drafting plans for the next Congress. Regardless of whether Democrats retake the House, or control both the House and Senate, various external factions will need stronger bipartisan strategies and tactics.
The Bank Policy Institute (BPI) made clear in its statement on the CLARITY Act's final vote that its member institutions will not give up on this: 'Banks across America continue to support establishing a sound, durable digital asset regulatory framework that will lay the foundation for U.S. global leadership for decades to come. We believe Congress can achieve this goal while also safeguarding the bank credit business that underpins economic growth. As lawmakers consider next steps, we recommend targeted adjustments to stablecoin yield policy. We stand ready to work with all stakeholders to accomplish this important goal.'
Crypto industry associations likewise said they will keep pushing forward. Blockchain Association CEO Summer Mersinger announced last Friday that she is stepping down, and founding head Kristin Smith will return as interim CEO. After the vote ended, Summer Mersinger said: 'The work to deliver long-awaited consumer protections and clear regulatory rules for American digital asset users and entrepreneurs does not end here. Tens of millions of Americans hold digital assets, yet American builders still have no clear federal rules; meanwhile, Europe, the UK, Singapore, the UAE, and Japan have all established their own regulatory frameworks... We will not stop until the U.S. industry gets clear regulatory rules.'
On December 11, 2025, Senate Banking Committee Senators Raphael Warnock (D-Ga., left) and Thom Tillis (R-N.C.) run into each other and shake hands on their way to meet bank executives at the Capitol Visitor Center
Key Republican Negotiator Exits
Unfortunately, several important officials who have played key bridge-building roles in the crypto policy and regulatory debates over the past decade are about to leave Washington.
North Carolina Senator Thom Tillis will not seek a third term and will leave office at the end of the year. He negotiated a yield-related compromise with Maryland Democratic Senator Angela Alsobrooks, and also worked with Arizona Senator Ruben Gallego to push the White House to include stronger bipartisan ethics provisions.
Wyoming Senator Cynthia Lummis has chosen not to run for another six-year term, saying she will return to her ranch. Lummis serves as chair of the Senate Banking Committee's digital assets subcommittee and led the CLARITY Act legislative effort. She has a reputation for bipartisan collaboration and previously worked with New York Senator Kirsten Gillibrand to advance the GENIUS Act. The vacancy she leaves behind will be hard to fill.
The core regulatory agencies corresponding to the CLARITY Act also face staffing vacancies. SEC Commissioner Hester Peirce, who has served two terms, sees her term expire this Friday and is about to return to academia. Since 2018, she has been a highly influential figure in crypto regulation. Before leaving office on October 2, Peirce posted on X last week to the White House: 'A delicate yet crucial task for regulators is to maximize people's freedom, within a reasonable regulatory framework, to make the best choices for themselves and their families, and to give them confidence to transact. As I depart, I am full of confidence that, under the excellent leadership of Chairman Paul Atkins and Commissioner Mark Uyeda, the outstanding team at the U.S. Securities and Exchange Commission will continue to maintain this balance.'
By the time Washington restarts legislative discussions to craft durable policy that can drive innovation and safeguard U.S. competitiveness, the departures of Peirce, Lummis, and Tillis will have a significant impact.
The Next Congress and Crypto Legislation
New and incumbent lawmakers of the 120th Congress will need to work with crypto industry associations, bank lobbying groups, law enforcement, compliance institutions, and various other parties that want to improve the Digital Asset Market Structure Act before the bill can be sent to the president for signature and enter the subsequent complex rule-making process. Given that Congress has never passed a bill that satisfies all parties, these goals are undoubtedly ambitious. Bipartisan compromise legislation is the most likely to survive Congress's various procedures.
There is reason to argue that institutions with deep connections in both party camps will be well positioned to help the next Congress draft a new version of the CLARITY Act.
