On Wednesday, September 16, 2026, The Banker reported that the US banking lobby vowed to continue its fight against crypto companies’ ability to offer stablecoin rewards, after the Senate failed to advance the Clarity Act in a Tuesday vote.
The crypto markets bill secured only 49 of the 60 votes needed for cloture, falling short of the threshold required to bring it to a floor vote. The setback dramatically reduced the odds of the legislation being signed into law in 2026, with prediction market Kalshi showing the probability dropping to an all-time low of 6.4%.
A coalition of banking industry groups, including the American Bankers Association and the Independent Community Bankers of America, issued a joint statement urging lawmakers to pursue “targeted changes to stablecoin yield policy” going forward.
With the Clarity Act stalled, attention is expected
With the Clarity Act stalled, attention is expected to shift toward how regulators implement the GENIUS Act, the stablecoin law enacted in 2025 a partner at law firm Seward & Kissel. He told The Banker that the underlying policy debate “is unlikely to disappear.”
The GENIUS Act currently prohibits stablecoin issuers from paying rewards directly to holders, though it permits third parties such as crypto exchanges to distribute yield. Banks have argued this creates a pathway for as much as $1.3 trillion in community bank deposits to flow out of the traditional banking system, a concern that had fueled their push for the Clarity Act’s tighter restrictions.
Steve Gannon, a partner at Davis Wright Tremaine, said the bill’s failure means banks now face the same deposit-flight risk they had sought to avert, since the proposed legislative limits on stablecoin yields are “no longer on the table.”
The vote also represented a political setback
The vote also represented a political setback for the Trump administration ahead of the November 3 midterm elections, as the White House had promoted the Clarity Act as central to its goal of positioning the US as the global leader in cryptocurrency.
Patrick Witt, executive director of the president’s Council of Advisers for Digital Assets, described the outcome as “a major disappointment” and “a failure of American leadership,” warning on social media that it raises the risk of global markets adopting regulatory standards set by Brussels or Beijing rather than Washington.
Negotiations over the bill had reportedly stalled after Democrats pushed for ethics provisions requiring the president and other federal officials to divest crypto holdings exceeding $1 million and representing at least 10% ownership in a digital asset company. President Trump disclosed more than $1.4 billion in income from crypto ventures in 2025, a factor that became a point of contention during talks.
Ari Redbord, global head of policy at blockchain
Ari Redbord, global head of policy at blockchain intelligence firm TRM Labs, suggested the bill’s failure stemmed more from election-year politics than substantive policy disagreements, noting Democrats were unlikely to hand the White House a legislative victory so close to the midterms.
Separately, Coinbase CEO Brian Armstrong called on the Securities and Exchange Commission and the Commodity Futures Trading Commission to establish clearer crypto regulations, as both agencies have signaled openness to new rulemaking in the absence of congressional action.
