CLARITY Act Odds Crash to 10% Before Senate Returns: Galaxy

Galaxy Research now puts the CLARITY Act’s chance of passing this year at 10%, ahead of a possible Senate procedural vote in September. Unresolved ethics rules and bank lobbying have weakened the measure’s support.

Senators return to Washington on Sept. 14 and face a working period of roughly three weeks before leaving for midterm election activity around Oct. 2. Thorn stated:

“The reality is that CLARITY is now much more about politics than policy.”

The firm reduced its estimate again to 10% on Aug. 14 as the Senate entered its recess without resolving the central disputes. The firm cited the unsettled ethics agreement, diminished Republican support following bank lobbying, and a September legislative session lasting only two to three weeks as obstacles to passage this year.

Three unresolved fights made it difficult for supporters to assemble 60 votes before the August break, and the majority leader declined to call a floor vote rather than risk defeat. Ethics controls, bank lobbying, and developer protections each resisted settlement despite bipartisan negotiations.

CFTC Chairman Michael S. Selig remarked: “New York intends to make event contract derivatives waste away under its iron curtain of state gaming laws before the courts get the chance to issue final rulings.”

Secretary Vanessa Countryman logged the cancellation in a notice dated Aug. 13, one day before commissioners were due to meet. Commissioners would have considered whether to release the proposal for public comment, rather than voting on a final rule. The notice supplies no reason and names no replacement date, leaving both the legislation and the SEC proposal unresolved.