Galaxy analysts warn that the CLARITY Act faces multiple hurdles, with about a 50% chance of passing before the midterm elections.

Mars Finance News: On April 21, Galaxy Digital research chief Alex Thorn warned that the critical U.S. crypto legislation, the “CLARITY Act,” is at a make-or-break moment. If the review is delayed to after mid-May, the likelihood of it being passed in 2026 will drop sharply. At present, the probability that the bill becomes law this year is estimated at about 50%, or even lower. Polymarket data also shows that its passage probability has fallen from 82% in February to 47%.

Thorn noted that the Senate calendar is currently packed with matters such as Iran military authorization, Department of Homeland Security funding, and presidential nominations, leaving little time for the bill. If Democrats regain the House after the November midterm elections, legislative work could stall.

Although the bill was already passed in the House last July with a bipartisan vote of 294-134, negotiations in the Senate are more complex, mainly facing several hurdles. First, disagreements over stablecoin incentives are the main reason the review was delayed from January. Second, a clause in the draft clarifying that clearly non-custodial software developers are not “money transmitters” has been opposed by law enforcement agencies. In addition, regarding moral provisions, some Democrats are pushing to restrict government officials and their family members from profiting from crypto assets during their terms. Finally, concerns about the SEC’s authority and issues such as vacant commission seats also add complexity on the political front.

Thorn believes that a full Senate vote in July is “theoretically possible,” but would require extraordinary political will and coordination.