Bessent Pushes the Deadline: "Get It Across the Line"
U.S. Treasury Secretary Scott Bessent is running out of patience. On February 13, he urged lawmakers to swiftly pass the Digital Asset Market Clarity Act, arguing that regulatory clarity alone could lift crypto markets out of their current slump. Bitcoin has been hovering near $69,000 with the Fear and Greed Index stuck at 9, the deepest extreme fear reading since the 2022 crash.
Bessent did not mince words. He called out a "nihilist group in the industry who prefers no regulation over this very good regulation," a pointed reference to crypto firms that have stalled the bill by fighting over specific provisions. He set an informal March 1 deadline for crypto executives and banking chiefs to reach agreement on the remaining disputes.
The bill passed the House in July 2025 with bipartisan support (78 Democratic votes). It should have reached the Senate floor months ago. Instead, it has been stuck in a tug-of-war between banking lobbyists, crypto companies, and lawmakers who cannot agree on provisions related to stablecoin yield. Bessent believes passing it would provide the structural certainty markets need to recover.
What the CLARITY Act Actually Does
The Digital Asset Market Clarity Act of 2025 (H.R. 3633) is a market structure bill. Its primary purpose is answering the question that has paralyzed the industry for years: who regulates what?
CFTC gets digital commodities. The bill gives the Commodity Futures Trading Commission exclusive jurisdiction over spot markets for digital commodities, including Bitcoin, Ethereum, Solana, and other tokens that meet the "digital commodity" definition. This pulls these assets out of the SEC's enforcement reach for secondary market trading.
SEC keeps securities oversight. The SEC retains authority over primary market offerings (ICOs, token launches) and any digital asset that qualifies as a security. The bill creates a framework for tokens to "graduate" from security status to commodity status once their underlying network is sufficiently decentralized.
New registration framework. Exchanges, brokers, and dealers trading digital commodities must register with the CFTC. A provisional registration regime allows existing platforms to operate while applications are processed, provided they protect customer assets and give regulators access to their books.
Customer protection rules. Exchanges cannot commingle their own assets with customer funds (the FTX problem). Self-trading by exchanges and their affiliates is prohibited unless specifically permitted by CFTC rulemaking for narrow purposes like market-making.
DeFi carve-out. Decentralized finance activities such as validation are excluded from registration requirements, though anti-fraud and anti-manipulation rules still apply.
Custody reform. Federal regulators cannot force banks to list customer crypto holdings as liabilities on their balance sheets or impose punitive capital requirements against custodied assets. This removes one of the biggest barriers to bank-level crypto custody.
New issuance exemption. Token issuers on "mature blockchains" can raise up to $75 million over 12 months without full SEC registration, similar to existing Regulation A+ exemptions for traditional securities.
Why It Stalled: The Stablecoin Yield Fight
The CLARITY Act does not directly regulate stablecoins. That is the GENIUS Act's territory. But the two bills have become politically entangled.
In January 2026, a single sentence buried in the 278-page Senate draft of the CLARITY Act reignited the stablecoin debate: a provision that banking lobbyists interpreted as opening the door to restrict stablecoin yield more broadly than the GENIUS Act intended. Coinbase CEO Brian Armstrong withdrew support for the Senate draft, prompting lawmakers to delay a planned committee markup.
The result: both bills are now frozen. The GENIUS Act's implementation details depend on the CLARITY Act's broader framework. The CLARITY Act cannot move forward because the stablecoin yield dispute has not been resolved. Banks, crypto firms, and Treasury are locked in a three-way negotiation.
Bessent's frustration is visible. He publicly named Coinbase as one of the parties blocking progress, while simultaneously acknowledging that banking lobbyists' push for a total stablecoin yield ban goes too far. His position: pass the CLARITY Act as-is, and deal with stablecoin yield details separately.
What This Means for Crypto Card Users
Regulatory clarity from the CLARITY Act would affect crypto card holders in several concrete ways:
Exchange-linked cards become safer. Cards issued by Coinbase, Bybit, OKX, Binance, and Kraken are tied to exchanges that currently operate in regulatory grey areas. CFTC registration with clear rules means these platforms face less existential risk from SEC enforcement actions. That translates to more stability for the cards they issue.
Custody rules protect card balances. The anti-commingling rules codify what responsible exchanges already do but make it a legal requirement. For users who hold stablecoin balances on exchanges to fund card spending, this is a meaningful protection.
Bank-issued crypto cards become more likely. The custody reform provision removes the capital penalty that currently makes it prohibitively expensive for banks to hold crypto on behalf of customers. JPMorgan, Bank of America, and other major banks have all explored crypto custody. With this barrier removed, bank-issued crypto cards become a realistic product category, potentially with FDIC-insured stablecoin deposits.
Self-custody cards stay unaffected. Self-custody cards from Gnosis Pay, MetaMask, Ledger, and Ready operate at the wallet level, outside the exchange registration framework. The DeFi carve-out explicitly protects the underlying infrastructure these cards use.
The March 1 Deadline and What Comes After
Three scenarios are in play:
Agreement by March 1. Crypto firms accept the CLARITY Act draft. Banks accept the GENIUS Act's current yield framework (issuers cannot pay interest, but platforms can offer rewards). Both bills move to the Senate floor. Markets rally on clarity. This is Bessent's goal.
Partial deal. The CLARITY Act passes without resolving the stablecoin yield question. The GENIUS Act's implementation is delayed to a separate bill. Markets get partial clarity on market structure but uncertainty remains on stablecoin regulation.
No deal. March 1 passes without agreement. Both bills miss the spring legislative window. Regulatory uncertainty extends through 2026. The US crypto market continues operating under enforcement-based regulation rather than clear legislation.
Bessent made his preference clear: "As both parties continue to work on the CLARITY Act, it can get across the line this year." The question is whether the industry agrees to accept imperfect regulation or holds out for perfect legislation that may never come.
Who Wins and Who Loses
The CLARITY Act's passage would create clear winners:
Winners: Regulated exchanges (clear operating framework), institutional investors (compliance certainty), bank custody (removed capital penalty), card issuers linked to registered exchanges (reduced regulatory risk).
Losers: Projects operating in the grey area between security and commodity classification (must now register or face enforcement), offshore-only platforms (US market access requires CFTC registration), maximalist deregulation advocates (Bessent's "nihilists").
For the average crypto card user, the CLARITY Act is background infrastructure. You will not wake up and notice it passed. But over the next 12 months, you would notice more card options, more stable platforms, and potentially bank-issued crypto debit cards entering the market. That is the practical impact of regulatory clarity.
FAQ
What is the CLARITY Act? The Digital Asset Market Clarity Act (H.R. 3633) is a US bill that creates a regulatory framework for crypto by giving the CFTC jurisdiction over digital commodities (Bitcoin, ETH, etc.) and the SEC oversight of securities offerings. It passed the House in July 2025 and is stalled in the Senate.
Why does Treasury Secretary Bessent want it passed? Bessent believes regulatory clarity will lift crypto market sentiment and prices. He has set an informal March 1 deadline for industry stakeholders to resolve disputes and allow the bill to reach the Senate floor.
How is the CLARITY Act different from the GENIUS Act? The GENIUS Act regulates stablecoins specifically (issuance, reserves, yield rules). The CLARITY Act is a broader market structure bill covering how all digital assets are classified, which regulator oversees them, and how exchanges must register and operate.
Will the CLARITY Act affect my crypto card? Not directly or immediately. Over time, it would make exchange-linked cards safer (clearer regulatory framework), enable bank-issued crypto cards (custody reform), and strengthen customer protections against exchange failures (anti-commingling rules).
What happens if the CLARITY Act does not pass? The SEC continues regulating by enforcement rather than legislation. Exchanges face ongoing legal uncertainty. Bank entry into crypto custody stays limited. The US crypto card market grows more slowly than markets with clear regulation like the EU under MiCA.
Overview
The Digital Asset Market Clarity Act would end years of regulatory confusion by giving the CFTC clear jurisdiction over digital commodities and creating registration frameworks for exchanges, brokers, and dealers. Treasury Secretary Bessent is pushing a spring deadline for passage, calling out industry "nihilists" blocking the bill. A March 1 deadline looms for crypto firms and banks to settle the stablecoin yield dispute that has entangled both the CLARITY Act and the GENIUS Act. For crypto card holders, passage means safer exchange-linked cards, potential bank-issued crypto cards, and stronger customer protections.
Recommended Reading
- White House Stablecoin Talks Collapse as Banks Demand a Total Ban on Yield
- CFTC Names 35 Crypto CEOs to Innovation Advisory Committee
- Gate.io CEO: Banks Lost the War on Stablecoins
