Authors: Nick Carpinito & Luke Leasure
Compiled by Deep潮 TechFlow
Deep潮 Summary: Trump personally pushed the CLARITY Act, but Democrats and Republicans are completely divided over enforcement authority—Republicans insist it be handed to the Department of Justice, whose nominee for Attorney General happens to be Trump’s personal lawyer, who earned $1 billion last year alone from cryptocurrency. This “self-regulation” design caused the market to quickly cool off from Tuesday’s euphoria, reversing gains by Wednesday.
The market took a breather on Wednesday as optimism around the CLARITY Act cooled following the release of the Senate’s revised bill text. Although cryptocurrency stocks gave back some of their recent gains, ETF fund inflows continued to strengthen, extending the strongest consecutive inflow streak since May. Below, we step back from the noise of headlines to break down what changed in the latest CLARITY draft and which provisions matter most to the crypto market.
Market Trends
During Wednesday’s trading session, prices diverged, with BTC and stock indices slightly declining, giving up earlier gains from this week. On Tuesday, the probability of the CLARITY bill passing surged from 31% to 51%, driving crypto-related stocks such as COIN and CRCL up by double digits. However, this probability has since retreated to 38%, pulling crypto stocks and other indices lower alongside it.
On Wednesday, Republican senators released an updated version of the bill, codifying ethical provisions into law, and markets may now be pricing in the likelihood of a vote on this actual language, rather than just reacting to headlines. The volatility in these cryptocurrency stocks suggests that this sector could be the biggest beneficiary of the bill’s passage. Stock index futures declined overnight, with the Nasdaq opening down 0.97%, causing major cryptocurrencies to dip slightly ahead of Thursday’s open.
Clarity's brief surge in probability lifted most crypto assets. If this momentum continues to build and the probability rises further, we should expect this legislation to act as a tide that lifts all boats. Shifting from high uncertainty to low uncertainty is inherently positive, regardless of how stringent the final regulations may be.
Chart: Probability of CLARITY Bill Passage (Source: Blockworks Research)
Supporting the price further, ETFs are experiencing their longest consecutive period of net inflows since early May, attracting $750 million in net inflows over the past five days.
Chart: Continuous ETF Inflows (Source: Blockworks Research)
Cut through the noise of CLARITY
This week, Trump broke the summer deadlock on the CLARITY Act, but the core dispute over enforcement authority remains unresolved. A White House official told Republican negotiators that the president accepted an ethics provision prohibiting federal senior officials, including himself and the vice president, from holding personal cryptocurrency interests, bringing CLARITY closer to a Senate vote. Lummis released an updated text on Wednesday, incorporating work from the Banking and Agriculture Committees, so the ethics provision is now publicly visible. However, it still does not specify who will enforce the ban, and Democrats say they have not yet seen a version they can accept.
Lummis and Moreno negotiated this ethics package with the White House without Democratic support. It prohibits the president, vice president, members of Congress, federal judges, and their spouses from issuing or endorsing digital assets for compensation during their term, with the provisions set to expire on January 20, 2029. Covered officials must sell their cryptocurrencies and shares in crypto companies or transfer them into blind trusts they cannot control. Republicans have assigned civil enforcement authority to the Department of Justice, including the power to prosecute exchanges that list prohibited tokens, with fines of up to $250,000 per day per intermediary and additional penalties of $500,000 or 10% of proceeds, plus disgorgement, for officials. Sales exceeding $1,000 require disclosure, and the Government Accountability Office (GAO) will study remaining loopholes.
The two sides are divided on enforcement. Senate Democrats want state attorneys general to oversee this restriction, while the White House and Republicans want the U.S. Attorney General and the Department of Justice to enforce it. Democrats argue that federal enforcement alone would be meaningless for a president whose former personal attorney, Todd Blanche, is currently awaiting Senate confirmation as a candidate for Attorney General—his disclosed filings show he earned over $1 billion last year solely from cryptocurrency. Senator Angela Alsobrooks called enforcement by the Department of Justice alone "not serious." Pressure is also coming from the left: Indivisible and Demand Progress have been pressuring Senate Democrats, including Kirsten Gillibrand, this week to reject a weak ethics agreement—precisely the votes Republicans need to reach 60.
The rest of the bill’s text remains largely unchanged. Industry insiders note that the Blockchain Regulatory Certainty Act is identical to the May Banking Committee version, continuing to exclude non-custodial developers and infrastructure providers from the definition of money transmitters; the Lummis-Grassley amendment retains criminal liability for intentionally aiding illicit actors, while the Protect Your Coins Act safeguards self-custody rights. The stablecoin yield provision preserves the Tillis-Alsobrooks compromise, prohibiting interest on idle payment stablecoin balances but permitting activity-based rewards. A new enforcement chapter funds state and local crypto investigations and establishes a cybersecurity center targeting North Korea and Iran; it also requires stablecoin issuers to comply with lawful freeze and seizure orders, and classifies customer assets as customer property rather than assets of a failed custodian—directly responding to FTX.
Time window: Less than three weeks
Less than three weeks remain. Majority Leader John Thune has pledged to schedule a floor vote before the recess, which is set to begin around August 7. The Senate needs to pass only one hurdle. The House will take up the revised version after returning in September, followed by the President’s signature and subsequent rulemaking by the CFTC and SEC.
Chart: CLARITY Act Timeline and Ethics Clause Sunset Points (Source: Blockworks Research)
How does the market price "voting"?
Traders price "voting" and "outcome" separately. The probability of the Senate voting before adjournment on Kalshi is near 72%, but volume is only $31,000—too thin to matter. On Polymarket, the probability of enactment into law by 2026 is near 41% ($2.4 million volume), while Kalshi’s deeper market on "crypto market structure becoming law by year-end" is near 42% ($3.6 million volume). These two deepest markets differ by 10 percentage points on the same issue, and neither side assigns an enactment probability above 50%. The notion of a "greater than 50% chance of passage" sits precisely at the optimistic edge of this range.
Chart: Kalshi and Polymarket pricing the probability of CLARITY becoming law (Source: Blockworks Research)
Chart: Probability of Cryptocurrency Market Structure Legislation (Source: Blockworks Research)
This week's loudest, with the weakest foundation
The biggest story this week was also the most baseless. An unverified rumor claimed that CLARITY would implement geofencing for U.S. users via the RPC layer and enforce actions against specific wallets, framed as negative news for HYPE; this was paired with another unverified claim—that Multicoin sold approximately $120 million worth of HYPE prior to its July 28 unlock. Multicoin’s Tushar Jain confirmed a large unlock on Wednesday but stated the firm had not exited, attributing the movement to privacy-driven "wallet rotation," not selling. No draft text supporting the alleged geofencing mechanism has been presented, and no such provision appears in the version released by Lummis on Wednesday.
Read and listen
Helium Q2 Token Holder Report
Blockworks interpreted this quarter as a "price reset" rather than a demand collapse: after HIP-143 reduced operator payment rates from $0.50/GB to approximately $0.10/GB on June 4, offload volumes increased by about 20%环比 during the transition. DC-burn revenue came in at $3.35 million, a 14% decline; Blockworks noted that the headline metric of "2.2x revenue coverage over emissions" is emission-driven—since HNT emissions fell 39% to $1.5 million while revenue itself declined, a withdrawal rate of approximately 1.7x provides a cleaner forward-looking indicator. Following the quarter, HIP-149, approved by veHNT, shifted miner rewards to usage and retired Proof-of-Coverage, funded by a self-terminating supplemental issuance of approximately 141 million HNT, flipping the network from deflationary to net issuance—this is critical to whether Helium’s pure operator model can sustain itself.
Chart: Helium Q2 Token Economics Data (Source: Blockworks Research)
Stablecoins are now available on Ramp
Ramp has partnered with Privy to integrate stablecoin payment channels into its platform, enabling businesses to open "stablecoin accounts" holding USDC or USDT backed by cash reserves, earning up to 3.25% in rewards, and paying suppliers’ wallets in over 140 countries or converting to more than 40 fiat currencies. Stablecoins also function as a standalone payment method within "Bill Pay": businesses can fund expenses from a USD bank account, and Ramp handles the conversion before sending—no balance required. Ramp reports that over 1,000 businesses are already using this method to pay suppliers, with more than 70% of transaction volume occurring outside traditional banking hours—a key insight highlighting the core value proposition: 24/7 settlement despite wire transfer cutoffs and cross-border delays.
Figure: Ramp Stablecoin Payment Channel (Source: Blockworks Research)
Earning dollars, not liquid dollars
John Conneely, Global BD Lead at Sky, believes the stablecoin rankings got the numbers wrong—mixing payment dollars and savings dollars in one competition, when they are vying for entirely different shelf space. His argument for USDS/sUSDS centers on "where the yield is": Sky’s savings rate is governed natively by the asset itself, whereas payment dollars like OUSD retain returns within platform-determined distribution protocols. He anchors his case in Sky’s $13.96 billion collateral book, spanning over 40 positions, including $4 billion in stablecoin reserves, $1.5 billion in tokenized U.S. Treasuries held via BlackRock’s BUIDL and Janus Henderson Anemoy, and nearly $3 billion in cross-chain and OTC crypto lending—positioning "allocation" rather than "supply" as the key metric for determining the savings race. Read this as Sky’s BD case study, not a neutral investigation; Conneely notes that these are his personal views, not those of the Sky Frontier Foundation.