Galaxy Research Pegs CLARITY Act at 50-50 Odds for 2026 Passage

Galaxy Research CLARITY Act odds just got a cold shower. In a research note circulated this week, Galaxy Digital head of firmwide research Alex Thorn put the probability of the Digital Asset Market Clarity Act becoming law in 2026 at roughly 50-50, and quite possibly worse. The headline number is bad enough. The reasoning underneath is worse.

Why Galaxy Thinks the Odds Are 50-50

Thorn's note, shared with reporters this week, does not hinge on a single disaster scenario. It hinges on arithmetic. The bill must clear five sequential procedural steps before year-end, each one fully dependent on the one before it. Miss any single gate, the whole thing stalls into 2027.

"In our view, the odds of CLARITY being signed into law in 2026 are roughly 50-50, and possibly lower," Thorn wrote. "The uncertainty stems not from any single issue but from the sheer number of unresolved questions that must be settled in sequence under severe time pressure." That is analyst speak for: the math runs out before the calendar does.

The most immediate pressure point is a Senate Banking Committee markup. If it slides past mid-May, the Galaxy Research CLARITY Act timeline collapses, because every downstream step (floor vote, reconciliation, conference, signature) gets shoved into a narrower window. And narrower windows in Washington have a habit of closing entirely.

If the markup slips past mid-May, the probability of enactment in 2026 will drop sharply.

The Five Sequential Steps That Must All Succeed

What does it actually take for CLARITY to become law?

For the CLARITY Act to reach the president's desk this year, five things have to happen, in this order, without any one of them blowing up:

• Senate Banking Committee markup before mid-May, per Galaxy's deadline math
• A 60-vote threshold on the Senate floor, which means peeling off Democrats
• Reconciliation between the Banking and Agriculture Committee versions of the Senate text
• Reconciliation with the House-passed text from July 2025
• A presidential signature before the lame duck window runs out

Polymarket Traders Are Already Voting With Money

If you want a second opinion, look at the prediction markets. The Polymarket CLARITY Act contract has generated more than $557,000 in trading volume since January, and traders currently price passage at roughly 43%. That number sat near 82% earlier in the year.

That is a 39-point collapse in perceived likelihood over a few months. Markets are not always right. But when Polymarket and a major crypto research desk independently converge on the same conclusion (that this is a coin flip at best) the burden of proof flips to the optimists.

JPMorgan analysts have publicly described CLARITY Act passage by midyear as a positive catalyst for digital assets. That framing quietly concedes the downside: no passage, no catalyst. And a lot of the institutional allocation thesis for this cycle has been resting on that catalyst showing up on schedule.

The Developer Fight Nobody Is Talking About

Most coverage has fixated on the stablecoin yield dispute. Galaxy's note flags something less visible but equally capable of sinking the bill: a provision lifted from the Blockchain Regulatory Certainty Act that has been folded into the Senate draft. It says, plainly, that non-custodial software developers who write code but do not control user funds are not money transmitters.

Crypto advocates treat this language as existential. Without it, US-based open-source development in crypto sits one enforcement memo away from criminal liability. Strip the provision, and the industry loses a line it has spent years defending. Keep it, and certain regulatory factions threaten to tank the entire package. Classic Washington veto geometry.

The broader standoff has four sides: crypto firms, traditional banks, the SEC, and structural critics in Congress. Each faction has effective veto power over a different provision. Nobody has enough votes to win outright. Nobody has enough incentive to fold first.

The deal is a must-have for unlocking the remaining issues.

What Happens if the Bill Misses 2026?

A few insiders have floated a lame duck session after the November midterms as a last-resort vehicle. Galaxy's note describes that scenario as low probability given the compressed legislative dynamics of a post-election Congress. Translation: do not bet on it.

That leaves institutional crypto staring at the same regulatory fog it has been staring at since 2022. Roughly 65% of institutional investors surveyed by Coinbase and EY-Parthenon cited regulatory clarity as the one thing holding them back from serious digital asset deployment. If CLARITY slips to 2027, that capital stays parked for another year.

Coinbase CEO Brian Armstrong reversed his company's earlier opposition and backed the current bill version in April. The White House has described the stablecoin yield compromise as holding firm. Armstrong, Witt, Thorn, and a prediction market full of traders with skin in the game are all looking at the same calendar. They are not all seeing the same outcome.

Call Galaxy's note a gut check. The industry has been telling itself CLARITY is close. Thorn just priced in the part nobody wanted to price: sequential risk. Five steps. One calendar. No do-overs until the next Congress.