Shark Tank host and veteran investor Kevin O’Leary said he’s convinced the Clarity Act will eventually advance in the Senate and could return as soon as the first quarter of next year.
Speaking at the Avalanche Summit in New York on Thursday, O’Leary said he didn’t expect the bill to advance on Tuesday, when it received 49 of the 60 Senate votes needed to proceed.
“The chances of CLARITY passing, in my view, were zero, and that’s what happened,” O’Leary said.
The legislation sought to establish a broader federal framework for crypto markets, including the roles of the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).
But O’Leary sees the failed vote as a delay rather than the end of the bill. He pointed to a separate crypto tax bill that advanced in the House this week as one reason he believes lawmakers will ultimately have to return to the issue of market structure.
The House Ways and Means Committee advanced the Digital Asset Tax Certainty Act, which seeks to establish tax rules for areas including staking, mining, small crypto transactions and broker requirements.
O’Leary argued that this creates an unusual situation in which Congress is moving toward laying out how crypto activities such as staking should be taxed while broader questions about how the industry should be regulated remain unresolved.
“Once you tax, you’ve got to have policy,” O’Leary said.
As crypto becomes a source of tax revenue, O’Leary believes lawmakers will face pressure to set clearer rules for the activities that generate it.
“We’re going to tax staking,” O’Leary said. “You know with certainty that policy’s coming in CLARITY, and it has to.”
He said he expects lawmakers to return to market-structure legislation after the midterm elections, regardless of which party controls Congress.
“When will it come? Probably in the first or second quarter after the midterms,” he said.