Crypto market structure bill still faces significant hurdles despite Senate committee win: analysts

The digital assets industry largely applauded the Senate Banking Committee advancing the Clarity Act, but the job of passing the legislation into law is still far from done, argue some analysts.

"We are slightly more optimistic that this package could become law after the markup, as it is clear there are Democrats who are looking for a way to back the bill," TD Cowen analyst Jaret Seiberg said Friday in a research note. "It is why we slightly raise the probability the bill passes to 40% from one-in-three. We still see substantive hurdles, but the hearing showed an interest in trying to surmount them."

The Senate Banking Committee voted on Thursday, 15-9, to advance its version of the crypto market structure bill, with support from both Democratic Sens. Ruben Gallego and Angela Alsobrooks.

The Clarity Act, which aims to regulate the crypto industry at the federal level, has been held up for months as the White House, lawmakers, crypto advocates, and the powerful banking lobby debated the proposed legislation. Stablecoin rewards and conflict-of-interest concerns were among the major sticking points.

Benchmark analyst Mark Palmer noted that, despite some recent movement, the legislation will likely need more support from Democrats to become law.

"The Banking Committee’s portion of the legislation must now be combined with the parallel market structure bill that the Senate Agriculture Committee advanced in January into a single comprehensive package for floor consideration," he wrote in a note. "For the bill to secure the 60 votes required to overcome a filibuster [it] will demand substantially more Democratic support than that of the two senators who voted for it yesterday."

Timing could also be a factor in whether the bill passes before the 2026 midterm elections.

Earlier this week, before the Senate Banking Committee vote, GSR Chief Legal and Strategy Officer Joshua Riezman said the odds of the Clarity Act reaching the president’s desk this session were below 50%. That assessment came in stark contrast to Coinbase CLO Paul Grewal saying the bill will pass this summer.

"We are not more optimistic because we continue to believe Democrats will demand a vote on an amendment that would apply conflict of interest standards to President Trump," TD Cowen said. "We believe Republicans do not want to take that vote as they do not want to be portrayed in upcoming elections as endorsing the involvement of the Trump family in crypto endeavors."

During the recent markup, Sen. Gallego said that if the ethics piece is not resolved — meaning the president, vice president, and other federal officials and their families are restricted from engaging in certain financial transactions involving crypto — he will vote no on the bill if it makes it to the Senate floor.