Senate Republicans on Thursday released an updated version of the Digital Asset Market Clarity Act, a sweeping 630-page bill that would establish the first comprehensive federal framework for cryptocurrency markets in the United States — with new language targeting so-called “decentralized-in-name-only” trading protocols.
The revised text arrives just days before a pivotal procedural vote scheduled for September 15, which many in the industry view as a last real chance to pass the legislation this year.
The bill’s lead sponsor, Sen. Cynthia Lummis (R., Wyo.), unveiled the updated draft on X, noting over 100 changes made at Democrats’ request during the August recess.
“This updated Clarity Act text reflects bipartisan hard work over August—specifying when decentralized-in-name-only DeFi protocols must register with the CFTC and limiting the DeFi provisions to spot and cash transactions, in response to Native American concerns about prediction markets,” she wrote. “Let’s get this done!”
If passed, the Clarity Act would effectively legalize most cryptocurrency activity in the U.S., draw clear jurisdictional lines between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC), and largely clear the way for crypto startups to raise funds through token sales once again.
The bill would also create registration pathways for digital asset exchanges, brokers, and dealers, and impose customer-asset protection and disclosure requirements. It cleared the House in July 2025 by a 294–134 margin and passed the Senate Banking Committee 15–9 in May 2026.
The DeFi crackdown
The most consequential addition in the new draft targets decentralized finance (DeFi)—a category of crypto protocols that are designed to operate autonomously without traditional intermediaries like banks or brokers.
The new text creates a distinct category for protocols that call themselves decentralized but remain under the effective control of identifiable people or organizations. The draft creates a new category, the “non-decentralized finance transaction protocol,” covering a DeFi protocol whose functions, operation or consensus rules can be effectively controlled or modified by such parties. Those platforms would be required to register with the CFTC and comply with Bank Secrecy Act obligations—the federal anti-money laundering rules that financial institutions must follow.
The legislation is intended to protect code development and genuinely decentralized activity while allowing regulators to apply existing requirements to people who control financial functions. Additionally, DeFi provisions in the bill are now limited to spot and cash transactions, meaning they would not apply to prediction markets, a change Lummis said came in response to concerns from tribal governments.
The 60-vote problem
Despite the revisions, the bill’s path through the Senate remains treacherous. To overcome a filibuster—the Senate procedure requiring a supermajority to advance legislation—the bill needs 60 votes. Republicans hold 53 seats, meaning at least seven additional votes must come from Democrats or independents even if the Republican conference holds together.
It’s unclear whether there are 60 votes for the bill at this time. According to a Politico report last month, no Senate Democrats are currently on board. Their central sticking point has been ethics: Democrats have sought to bring attention to what they view as a conflict of interest on the part of President Trump, and are demanding the Clarity Act include ethical provisions to limit such deals. Trump’s crypto connections have helped the first family rake in over $2 billion from the sale of memecoins and other crypto deals.
The ethics provisions in the revised draft remain largely unchanged from July’s version, which prohibited public officials, their employees, and their spouses from issuing or sponsoring digital assets—language Democrats have criticized as insufficient.
Lummis pushed back sharply on that characterization, arguing that the bill already incorporates virtually everything Democrats asked for.
“They demanded the felony bar on fraudsters, $150M for the CFTC, the crackdown on platforms like Binance, and they got almost everything they asked for. Now they need to vote for the bill they built. Anything less is walking away from their own work,” she wrote on X.
Lummis, who is set to leave Congress in January 2027 as she is not seeking another term, has previously warned that if the bill fails next week, “we will not get another realistic shot at this before the end of the decade.”
This updated Clarity Act text reflects bipartisan hard work over August—specifying when decentralized-in-name-only DeFi protocols must register with the CFTC and limiting the DeFi provisions to spot and cash transactions, in response to Native American concerns about prediction…
— Senator Cynthia Lummis (@SenLummis) September 10, 2026
Industry lobbying and banking opposition
The revised bill has also landed in the middle of a battle between the crypto industry and community banks over stablecoin yield, i.e. whether crypto platforms can pay interest-like rewards to users who hold stablecoins, digital tokens pegged to the value of fiat currencies like the US dollar. Banks view yield-bearing stablecoins as direct competition for customer deposits, and have lobbied heavily against the provision.
Industry advocacy group Stand With Crypto said supporters contacted members of Congress nearly 50,000 times in August alone, while community bankers have continued to press senators in their home states for changes to the rewards provisions.
The crypto industry poured nearly $200 million into candidates backing the Clarity Act in the 2026 election cycle. That investment has helped shift Washington’s posture toward the industry, but it has not resolved the partisan standoff in the Senate.
Market skepticism
Prediction markets are not optimistic. At press time, The Clarity Act faces a 18% chance of becoming law in 2026, according to Polymarket traders. Solana Policy Institute CEO Miller Whitehouse-Levine put the odds of passage before the November midterm elections at just 10%.
“I personally am a bit pessimistic about the Clarity Act being passed,” John Darsie, CEO of SALT, an investment and networking forum, told CNBC in August. “Leading into the midterms, you don’t often pass legislation of this magnitude.”
For the crypto industry, the stakes could hardly be higher. If the bill dies, the U.S .market for digital assets would continue to operate largely through SEC enforcement actions and existing CFTC rules—regulatory conditions the industry has spent years and hundreds of millions of dollars trying to replace.