The Clarity Act Won’t Get a Vote Before Recess. And the Real Story Isn’t Armstrong

Yesterday we finally got confirmation of something we knew was coming: the Digital Asset Market Clarity Act (CLARITY Act) will not be voted on before the August recess.

It’s tempting to trace this back to January, when Coinbase CEO Brian Armstrong pulled his company’s support over stablecoin yield restrictions. That’s not actually why we’re here, though. Armstrong’s objection was resolved months ago. The reason the bill is stuck this week is a different fight.

Armstrong Was Right, and It Got Fixed

In January, Armstrong said Coinbase would rather have “no bill than a bad bill,” objecting to language that would have restricted stablecoin yield and handed the government broad access to users’ financial data. I was in the minority who agreed with him at the time. The yield provisions were genuinely anti-competitive.

TradFi (traditional finance) banks would finally have had to compete with modern fintech companies on deposit yield, and they’d have lost badly. Fintech companies like Coinbase can offer considerably higher returns on deposits than traditional institutions like JP Morgan. Banks have spent years hiding behind “competition is good,” right up until they were the ones facing it.

That fight is over now, though. In May, Senators Thom Tillis and Angela Alsobrooks landed a compromise that bans passive stablecoin yield but allows activity-based rewards. Armstrong came back on board and publicly told the Senate to “mark it up.” Coinbase has been backing the bill ever since.

So Armstrong isn’t why we’re still waiting in August. Something else is.

The Real Holdup: Trump’s Crypto Earnings

The current sticking point is ethics, not yield. Since becoming President, Donald J. Trump, his family, and World Liberty Financial (WLFI) have earned roughly $1.4 billion from crypto ventures in 2025 alone, largely thanks to the lack of crypto regulation in the US. It’s no surprise Democrats are furious and pushing to amend the bill to stop a sitting president and their administration from profiting this way in the future.

Trump was supposed to be “the crypto president.” In one sense, he is: he’s the president who made billions from crypto, including from a meme coin his own supporters bought into. That’s the conflict of interest Democrats, and a handful of Republicans, now want closed before they’ll sign off.

What Happens Next

The Trump administration and Senate leadership now have until mid-September to negotiate ethics language that satisfies enough Democrats, and some Republicans, to get the CLARITY Act over the line. Senate Majority Leader John Thune has said a vote will happen when lawmakers return, with Senator Cynthia Lummis leading the push to bring it back up first.

Whether that compromise text can hold the roughly seven Democratic votes needed to clear the 60-vote threshold is still an open question.