US SEC Readies Crypto Rules as CLARITY Act Faces Senate Delay

TLDR

• SEC Chair Paul Atkins said the agency can issue crypto rules if the CLARITY Act stalls.
• Atkins said the SEC is giving lawmakers technical support on crypto market rules.
• The CLARITY Act has passed the House and remains under Senate review.
• Senate priorities have slowed crypto bill progress before the August recess.
• Polymarket odds for 2026 CLARITY Act passage dropped to 35%.

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SEC Chair Paul Atkins said the agency is prepared to issue crypto market structure rules if Congress fails to pass the CLARITY Act, while Senate delays continue to narrow the bill’s 2026 window.

SEC Prepares Rulemaking Backup Plan

Atkins said the SEC is assisting lawmakers with technical guidance as they review the digital asset market structure bill. He said congressional action remains the preferred path because a statute would give regulators clearer direction.

The SEC chair said,

“We’re doing all we can to help them answer their questions and provide technical assistance. But ultimately, statute is the way to future-proof something.”

Atkins also said the agency can act through its own rulemaking powers if the bill does not pass. He added, “We are ready, willing and able to come out with rules that address the same issues in clarity and in other aspects of the crypto market.”

The comments came as the CLARITY Act faces slower progress in the Senate. The bill has already passed the House, while Senate committees have reviewed market structure language covering crypto exchanges, brokers, tokens, and oversight roles.

Senate Delay Puts CLARITY Act Timeline Under Pressure

Senate leaders have shifted attention toward a Russia sanctions package and presidential nominees. That schedule leaves less floor time for crypto legislation before the August recess.

The delay has weakened expectations for quick passage. Polymarket traders cut the odds of the CLARITY Act becoming law in 2026 to 35%, down from a February peak of 82%.

Crypto markets also reacted to the slower timetable. Bitcoin fell below $65,000, while Ethereum dropped nearly 4% as traders reduced exposure during the July 28 market pullback.

Supporters say the bill must advance before the summer recess begins on August 7. The coming midterm election cycle could make bipartisan crypto legislation harder to move later in the year.

Senator Cynthia Lummis recently released a merged draft combining work from the Banking and Agriculture committees. The Banking Committee had advanced the bill in May through a 15-9 vote.

Republicans would still need enough Democratic support to pass procedural hurdles. If Senate Majority Leader John Thune files cloture, backers may need about 10 Democratic votes to overcome a filibuster.

Ethics Dispute Remains a Key Sticking Point

The main dispute involves ethics rules tied to digital asset activity by senior government officials. The current draft would ban the president and other top officials from issuing digital assets for profit.

Some Senate Democrats argue the language does not go far enough. They want stronger limits covering immediate family members and other conflict-of-interest concerns tied to crypto ventures.

New York Attorney General Letitia James has also raised concerns about state-level authority. She warned that the current bill could weaken state investor protection laws and limit fraud enforcement powers.

Atkins said the SEC still prefers legislation because statute can give the agency a durable framework. He said,

“But ultimately, we need the certainty of a statute that will help future proof so that we have clear direction and to go for.”

If Congress misses the 2026 window, crypto rulemaking may shift back toward regulators. The SEC and CFTC could move ahead with rules covering trading venues, token classifications, custody, disclosures, and market oversight.

Regulatory attention would also turn toward the GENIUS Act, which already gives policymakers another path for stablecoin rules. The CLARITY Act remains the broader market structure bill, but Senate timing and ethics negotiations now decide whether it reaches a final vote this year.