Senator Lummis Declares CLARITY Act Top Priority Amid Banking Divide

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Senator Lummis Declares CLARITY Act “The Priority” Amid Fresh Banking Divide

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Senator Lummis urges immediate Senate action to end regulatory uncertainty for the crypto industry
A bipartisan compromise on stablecoin yield language has cleared a major roadblock, but faces pushback from large banks
Banking trade groups plan to increase outreach to Senate Banking Committee members ahead of the anticipated markup

Senator Cynthia Lummis of Wyoming is urging the Senate to quickly pass the Digital Asset Market Clarity Act. She believes this bill is now Congress’s most important task, as it will finally provide clear rules for the crypto industry and resolve years of uncertainty.

The Senator wrote on X (formerly Twitter) that the entire industry is facing legal confusion that Congress could resolve. They urged the Senate to take action.

The Clarity Act needs to be addressed immediately – it’s the most important issue right now. Businesses across the industry are facing legal confusion that Congress can resolve. The Senate must take action.

— Senator Cynthia Lummis (@SenLummis) May 5, 2026

This announcement follows a recent agreement between Senators Thom Tillis and Angela Alsobrooks on rules for stablecoins. This deal removed a significant obstacle and led to a jump in the prices of companies involved with cryptocurrency, including a nearly 20% increase for Circle and a more than 6% increase for Coinbase.

According to The Crypto Times, the new agreement prohibits stablecoins from offering rewards simply for holding them, but allows incentives for actively using them.

Fresh Banking Pushback Emerges

The tentative agreement is already running into trouble within the banking industry. Journalist Eleanor Terrett reports that larger banks with direct consumer services are objecting to certain wording, while banks without those services seem more accepting.

While some community banks are showing willingness to accept the new rules, the Independent Community Bankers of America (ICBA) still has reservations. Larger banks have expressed that the current wording isn’t strong enough and could still allow cryptocurrency companies to find loopholes. They don’t see it as a fair middle ground, as it doesn’t completely stop crypto firms from offering rewards – it just changes the way those rewards are given.

A disagreement is emerging among banks regarding the agreed-upon terms. Larger banks that directly serve consumers are expressing concerns, while those focused on other areas seem satisfied with the current wording. Some smaller, community banks are also indicating their support, though the Independent Community Bankers Association, which represents them, has not yet fully weighed in.

— Eleanor Terrett (@EleanorTerrett) May 5, 2026

Banking industry groups are preparing to contact more members of the Senate Banking Committee, not just the key negotiators, before the committee votes on the bill. This comes after the main negotiators announced the previous night that they believed a deal had been reached.

Building on Months of Progress

Senator Lummis, who leads the Senate Banking Subcommittee on Digital Assets, announced in Las Vegas at the Bitcoin 2026 Conference that her committee will vote on the Clarity Act in May. She expressed confidence they would pass the bill, stating that most details regarding stablecoins and how the market is structured had already been worked out.

The Digital Asset Market Clarity Act (H.R. 3633) passed the House of Representatives in July 2025 with support from both Democrats and Republicans. This law is designed to clarify which digital assets fall under the regulatory authority of the Securities and Exchange Commission (SEC) and which are overseen by the Commodity Futures Trading Commission (CFTC). It also establishes operating standards for cryptocurrency exchanges, custodians, and those involved in decentralized finance (DeFi). Crypto Times has closely followed the bill’s progress, including Senator Lummis’s previous statements that this might be the last chance to pass it before 2030, and the recent positive market reaction to a compromise regarding stablecoins.

Key figures in the industry are becoming more hopeful about the Clarity Act. Ripple CEO Brad Garlinghouse recently suggested a significant increase in optimism, and prediction markets now estimate the bill has a 60-64% chance of becoming law by 2026.

What’s at Stake and What’s Next

The Senate Banking Committee is aiming to begin reviewing the proposed digital asset legislation the week of May 11th, leaving limited time before the August break. Supporters of the bill warn that further delays could lead to investment leaving the U.S., slow down innovation, and diminish American leadership in the digital asset space—a sentiment widely shared throughout the industry following Senator Lummis’s recent update. Senator Lummis has consistently presented the Clarity Act as vital for the growth of decentralized finance (DeFi), providing legal protections for those building and operating these systems while preventing excessive regulation.

This new bill, combined with the existing GENIUS Act, aims to establish a complete set of rules for cryptocurrency in the United States. All eyes are now on the Senate, as a positive committee vote would move the bill to a full Senate vote, where it needs 60 votes to pass. If it passes the Senate, it would then be compared to a similar bill already approved by the House, and could potentially be signed into law by the President later this year. Despite the uncertainty, crypto markets are optimistic, and Bitcoin recently surpassed $80,000, likely due to these encouraging signs of regulation.

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2026-05-06 09:25