Headline: CLARITY Act hits fresh roadblocks as 2026 midterms divert Washington’s attention The long‑awaited CLARITY Act — the Biden administration’s bid to create a clearer regulatory market structure for crypto — is losing legislative traction as Capitol Hill shifts focus toward the 2026 midterm elections. Despite private talks at the White House and ongoing negotiations among lawmakers, banks and crypto firms, lawmakers have yet to forge the bipartisan consensus needed to move the bill forward. Time running short, administration warns Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets, told Yahoo Finance’s Opening Bid that momentum is slipping and urged policymakers to act quickly. “Let’s not let any moss grow here,” Witt said, adding the window to pass the bill is “rapidly closing” as campaign season takes over the congressional calendar. He warned that midterm cycles typically crowd out complex policy debates, making swift action increasingly difficult. Stablecoins remain the central sticking point A core area of disagreement is stablecoin regulation and its implications for the traditional banking system. Lawmakers and banking representatives have warned of a potential large-scale deposit migration from banks if stablecoins are not subject to clear and appropriate rules. One hotly contested question is whether stablecoins should be allowed to pay yield — a provision that opponents argue could accelerate deposit outflows and further complicate efforts to marshal enough votes for passage. Industry optimism — for now Despite the headwinds, Coinbase CEO Brian Armstrong struck an optimistic tone during the company’s recent earnings call, saying he’s “quite optimistic” that some form of the legislation could be approved “in the next few months.” Armstrong pointed to alignment among major crypto companies and framed the negotiations as an opportunity to craft balanced rules that benefit banks, crypto firms and consumers alike. Administration pledges to keep pushing Witt said the administration remains committed to refining the proposal and working across the aisle to shore up the bill’s weaker points while preserving its core goals. “It’s a good product at the end of the day,” he said, signaling that the White House plans to continue negotiations even as the political calendar gets crowded. What to watch next - Whether negotiators can bridge differences on stablecoin yields and deposit protections. - If lawmakers can find a compromise before campaign activity consumes Capitol Hill. - Signals from major crypto firms and banks on concessions they’ll accept to break the impasse. Featured image: OpenArt. Chart: TradingView.com. Read more AI-generated news on: undefined/news