Odds of the CLARITY Act becoming law this year on Polymarket fell sharply again on Monday after spiking the day before, as key Senate Democrats reportedly said they had not been swayed by Republicans’ “final” crypto bill proposal.  

Polymarket traders initially saw a newly revised Republican proposal with expanded ethics provisions as a positive sign, sending the odds to 35%. However, their confidence was dashed as reservations about the revised text began mounting, with the odds falling back as low as 16% on Monday. 

US Senator Mark Warner, one of the Democrats involved in negotiations, reportedly said the revised ethics provision was not “near enough,” while Democrats involved in negotiations began preparing a counterproposal on Monday. 

Republicans need 60 votes to advance the bill, and failure on Tuesday could stall legislation that would determine how the US Securities and Exchange Commission and Commodity Futures Trading Commission divide oversight of the US crypto market.

Key Democrats remain unconvinced by ethics offer

Punchbowl News’ Brendan Pedersen reported that Senator Raphael Warnock said Democrats should not advance legislation that fails to address opportunities for corruption that are occurring “in real time.”

Pedersen reported that Senator Ruben Gallego said the latest ethics offer left “much to be desired” and that he planned to work on a counterproposal. Pedersen separately reported that staff for Senator Elizabeth Warren on the Senate Banking Committee circulated talking points arguing that the proposed state AG enforcement mechanism could be overridden by a determination from White House ethics officials.

Democrats have since sent their counterproposal to Republican negotiators, Politico’s Jasper Goodman reported, citing three people with knowledge of the matter.

Not all Democrats oppose advancing the bill toward floor consideration. Senator Kirsten Gillibrand has privately urged colleagues to support the procedural motion, Politico reported. 

Republican Senator Cynthia Lummis said President Donald Trump had accepted two significant ethics provisions and that there was “nothing left to give” Democrats.

The resistance adds to opposition from a coalition of 18 state attorneys general and raises further uncertainty about whether Republicans can assemble the votes needed to advance the bill. 

Banking and tribal groups challenge latest text

The Indian Gaming Association, a national organization representing tribal gaming interests, urged member tribes to press senators to vote against the bill, saying its proposed decentralized finance changes did not address Indian Country’s concerns about prediction markets. 

The association called for explicit language affirming that federal commodities law does not preempt tribal or state gaming laws, including the Indian Gaming Regulatory Act.

Related: Revised CLARITY Act targets ‘non-decentralized’ DeFi operators

Eight banking trade groups also said the revised text failed to close loopholes allowing stablecoin rewards that function like deposit interest. According to the groups, the proposed regulatory “circuit breaker” would activate only after substantial deposit flight from community banks had already occurred.

Crypto industry groups have urged senators to advance the legislation. In a statement on Monday, Blockchain Association CEO Summer Mersinger said the industry had made significant concessions to help build bipartisan support and urged every senator to vote yes. 

She argued that the bill would provide clear rules, protect consumers and deter illicit activity while preventing crypto jobs, developers and innovation from moving overseas. 

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