Senate Banking Chair Casts Doubt on April CLARITY Act Markup, Citing Three Key Hurdles

Senate Banking Committee Chair Tim Scott has suggested that the CLARITY Act markup may not hold this month, contrary to earlier expectations. This came as he cited three key hurdles, which he indicated could take beyond April for them to resolve.

Senator Tim Scott Suggests April CLARITY Act Markup Far From Certain

During an interview on FOX Business ‘Mornings with Maria,’ the senator said that he could not give a definite date for the crypto bill’s markup because there are three major issues they need to resolve. The first issue he mentioned was the clash between the banks and the crypto industry over stablecoin rewards.

The Senate Banking chair said he believes that they will be able to resolve this stablecoin rewards issue within the next two weeks. As CoinGape reported, Senator Thom Tillis, who is also a member of the Banking Committee, hopes to release the stablecoin yield text in the CLARITY Act this week in a bid to resolve this issue.

The second issue Senator Tim Scott mentioned is the DeFi piece, which he noted they have to ensure is in place. He said that they could resolve this within the next two weeks. It is worth noting that law enforcement groups are currently clashing with crypto stakeholders over the provision that alludes to the Blockchain Regulatory Certainty Act (BRCA).

The BRCA provision in the CLARITY Act protects crypto developers of DeFi and DEX platforms, ensuring they are not liable for any illicit activity committed by protocol users. However, these law enforcement groups argue that such a provision will make it harder to crack down on financial crime.

Gaining Support From All Republicans

The Senate Banking Chair stated that the third issue is getting all Republicans on board and ensuring they are on the same page regarding the CLARITY Act. He noted that this issue could take another couple of weeks to resolve.

Gaining support from all Republicans on the Committee is key, especially since they may need to advance the crypto bill across party lines if all Democrats object. Scott expressed optimism that, as they head into the summer, they would have resolved all issues regarding the CLARITY Act.

The senator also signaled support for the crypto industry’s claim that stablecoin yields don’t pose a risk to bank deposits. He stated that they have not seen any savings accounts leak into stablecoins. “We actually saw an increase in the number of dollars put into savings accounts since the third quarter of last year,” Scott added.

The Senate Banking chair also suggested that the banks were simply afraid of competition from the crypto industry, which clouded their judgment. This comes just a day after a banking group pushed back on the White House stablecoin report, which downplayed the risks that stablecoin yields pose to bank lending and deposits.

As these issues continue to linger, crypto market participants are becoming less optimistic about the CLARITY Act passing this year. The odds of Trump signing the crypto bill into law this year are currently at 54%, according to Polymarket data.