Time is running out for the crypto industry’s landmark bill — and with it, the industry's best chance at a law that outlasts this administration.

The Digital Asset Market Clarity Act, or CLARITY, would create a federal rulebook for issuing, trading and holding digital assets, dividing oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission, setting standards for exchanges and other intermediaries, and defining how decentralized-finance developers and protocols would be treated. Backers call it a test of whether the next generation of trading, payments and capital formation gets built in the United States or in jurisdictions with clearer rules.

The immediate obstacle is arithmetic. The bill needs 60 votes; Republicans hold 53 seats. That leaves its sponsors hunting at least seven Democrats, and they have not found them.

The clock is tighter than the calendar suggests. CLARITY did not appear on the Senate’s schedule Monday, when the chamber's only roll-call vote was on a continuing resolution to fund the government. No cloture motion has been filed on the bill. Under the Senate's ordinary rules, a filing Wednesday would produce a vote Friday, the last scheduled day before the recess — and that vote would only end debate on the motion to proceed, not pass anything.

Last month, Majority leader John Thune said that he did not expect the bill to clear the chamber before the recess, though he said he hoped to begin the floor process. White House crypto adviser Patrick Witt said he was more optimistic, pointing to the Senate’s session days in early August.

Prediction markets are less equivocal: Polymarket puts the odds of enactment this year near 30%, down from 82% in February. Galaxy Research has landed in the same place.

"It does seem like CLARITY may be dead in the water because after the summer recess, the focus is going to be on the midterms and not on trying to get a complicated bill like CLARITY passed," says Ladan Stewart, global head of fintech at White & Case and former lead of the SEC’s specialized crypto trial unit.

The Senate leaves Washington at the end of this week and does not return until Sept. 14, leaving about three weeks before lawmakers scatter again in early October and stay away through Election Day. When they come back in November, barely five session weeks remain before year-end, with annual spending bills and other must-pass measures competing for floor time.

And if Democrats take the House, Stewart adds, CLARITY is unlikely to pass at all........

© Forbes