CLARITY Act Hits Senate Floor as Lummis Warns Banks Join or Get Left Behind

Key Takeaways

• The CLARITY Act hit the Senate floor with 4 weeks to pass before the July recess, and Lummis warns failure pushes it to 2030 with odds at 61%
• JPMorgan completed a tokenized Treasury settlement on XRP Ledger in May, while its lobby fights the bill that would make it legal at scale
• Lummis told banks to join or get left behind as Bank of America appointed a crypto chief and Standard Chartered projects $4-8B in XRP ETF inflows

The CLARITY Act is moving closer to a Senate vote after clearing the Senate Banking Committee in May. With lawmakers facing a crowded legislative calendar before the July recess, the bill has entered what could be its most important stretch yet. Supporters see it as a chance to establish clearer rules for digital assets in the US. But banks and crypto firms continue to debate what those rules should look like.

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Why the 4-Week Window Before July Recess Is Crypto’s Last Chance Until 2030

The bill passed the Senate Banking Committee by a 15-9 vote on May 14 and has since been placed on the Senate Legislative Calendar. Senator Cynthia Lummis has been urging lawmakers to keep the process moving. She argues that delaying action could make it significantly harder to revisit the comprehensive crypto legislation once the midterm election cycle takes over the Senate agenda. She took to X and voiced out her concern.

It should be noted that the CLARITY Act still faces a number of hurdles. It needs to clear the Senate’s 60-vote threshold. Following this, it needs to be reconciled with House legislation and ultimately reach the President’s desk. Amidst this, lawmakers are juggling other priorities competing for limited floor time before the July recess.

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Why Banks Are Watching the CLARITY Act Closely

Banking groups have argued that some provisions could allow crypto companies to offer rewards that compete with traditional deposits. The American Bankers Association recently pointed to polling showing that 57% of consumers support limits on interest-like rewards tied to stablecoins.

At the same time, large financial institutions continue experimenting with blockchain-based infrastructure. JPMorgan recently participated in a tokenized US Treasury settlement pilot involving the XRP Ledger, Mastercard, and Ondo Finance. According to Ripple ecosystem data, the XRP Ledger now supports more than $3.5 billion in tokenized real-world assets.

In addition, XRP outperformed several major cryptocurrencies. Standard Chartered has previously estimated that spot XRP ETFs could attract between $4 billion and $8 billion in inflows under a more defined regulatory environment.

Supporters of the CLARITY Act say clearer rules could encourage increased institutional participation in digital assets. It could also reduce uncertainty around custody, trading, and tokenized assets. But critics argue that parts of the legislation still need stronger safeguards for consumers and the financial system.

The bill faces several hurdles. Prediction market Polymarket previously placed the odds of passage this year at 60%. But more recently, this declined by 13% in recent weeks and dropped to 51%.

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