The CLARITY Act: inside the Senate battle that will define DeFi’s future

Three unresolved fights over presidential crypto income, developer liability, and $1.35 billion in stablecoin yield stand between the most ambitious digital asset bill in American history and a legislative graveyard. With Polymarket odds at 13% and the August recess days away, every clause carries consequences that will shape crypto regulation for years. Summary The CLARITY Act passed the House 294 to 134 with 78 Democratic votes and cleared the Senate Banking Committee 15 to 9, but Polymarket odds of 2026 passage have collapsed from 82% in February to 13% as of August 5. President Trump’s 2025 financial disclosure revealed approximately $1.4 billion in crypto-related income, including $635 million in $TRUMP memecoin royalties and more than $500 million from World Liberty Financial token sales, making the ethics provision the bill’s most politically charged clause. Section 604 shields non-custodial software developers from money transmitter registration and Bank Secrecy Act obligations, a provision law enforcement groups call a compliance-free lane for illicit finance and the DeFi industry calls a publishing right. Coinbase earns approximately $1.35 billion annually in USDC rewards...