Unpacking the latest on the Senate Ag vote and CLARITY Act

Unpacking the latest on the Senate Ag vote and CLARITY Act

Author:

The Carta Policy Team

Read time:

6 minutes

Published date:

February 3, 2026

Senate Ag advances its crypto market structure bill, the SEC clarifies tokenization rules, and bipartisan negotiations continue on the CLARITY Act as regulatory priorities shift toward on-chain infrastructure and digital asset oversight.

Topline

CLARITY Act sees movement in the Senate

The Senate Agriculture Committee advanced its portion of the crypto market structure framework, notching a win for the crypto industry. The measure, which is largely in line with the version passed by the House last year, focuses on digital commodity intermediaries and expanding Commodity Futures Trading Commission (CFTC) authority over crypto spot markets:

Despite initial bipartisan support, the current version only garnered support from Republicans. Democrats offered amendments addressing longstanding concerns over ethics, consumer protection, and government financial assistance, all of which failed along party lines. But in response to Democrats’ desire for a bipartisan deal, Senate Ag leadership committed to working across the aisle as the bill moves toward the floor.

Meanwhile, Senate Banking negotiations got some help from 1600 Pennsylvania. The White House convened banking trades and crypto industry representatives to resolve CLARITY Act disagreements over stablecoin interest and rewards. The latest version attempts to close a gap left by the GENIUS Act, which prohibits stablecoin issuers, but not crypto exchanges, from paying interest to stablecoin holders. Discussions were constructive, although no immediate compromise was reached. Both sides are working to reach a solution by the end of February, aligning with White House expectations.

Why it matters: Positive progress, but there are a number of issues to solve before CLARITY makes its way to the president’s desk. In addition to stablecoin yield, concerns around tokenization and DeFi need to be addressed, as well as ethical issues to ensure bipartisan support, particularly as new reports emerge regarding Trump family crypto ties. Finalizing a market structure package is an administration priority, adding pressure to reach consensus as the legislative window tightens. The crypto industry (and its $193 million warchest) will help prevent deprioritization on the legislative agenda, meaning other priorities such as capital formation may slip— which is why engagement is so important.

What to watch: While market structure legislation stalls in Congress, the CFTC and SEC are moving ahead to lay out rules to foster industry growth. Last week, SEC Chairman Paul Atkins and CFTC Chairman Mike Selig previewed Project Crypto, a joint initiative that aligns the two agencies’ approaches to digital asset markets, tokenization, and on-chain financial infrastructure. The agency leaders emphasized coordination around jurisdictional boundaries, reaffirming that assets functioning like securities remain under the SEC’s remit, while commodities-like tokens and derivatives activity fall to the CFTC. Importantly, regulators signaled growing openness to regulated tokenized securities, on-chain settlement, and new trading models, so long as they operate within existing statutory frameworks. Rather than proposing sweeping new rules, Project Crypto is framed as an effort to clarify how current regulations apply to evolving market structures and to reduce uncertainty that has stalled institutional adoption.

SEC outlines the rules of the road for tokenized securities

Last week, the SEC’s Divisions of Corporation Finance, Investment Management, and Trading and Markets issued a joint statement delivering a clear message to markets: tokenization changes the plumbing, not the policy. Changing how ownership is being recorded does not change the nature of what is being sold. A tokenized security is still a security, and the federal securities laws apply the same way they do to traditional book-entry ownership. The SEC staff categorized tokenized securities and anchored them firmly within existing law.

Why it matters: The statement resolves ambiguity about whether placing a security on a blockchain changes its legal status. Further, it reinforces a technology-neutral approach to regulation, permitting blockchain technology to modernize market infrastructure without rewriting the securities laws. That framing matters even more as Congress attempts to legislate digital asset market structure. The SEC’s clarification comes as there is a growing dispute on Capitol Hill and within the crypto industry itself on how tokenization should be addressed and interpreted in legislation.

Bigger picture: Chairman Atkins has framed tokenization as a pivotal force that could modernize U.S. financial markets within a very short timeframe, likening it to the electronification of markets. Atkins argues that tokenization can boost transparency and efficiency by enabling on-chain settlement that narrows the gap between trade execution and final settlement, which could streamline functions ranging from dividend payments to shareholder communications. While emphasizing that tokenized securities remain subject to federal securities laws, the SEC is developing a clear token taxonomy and regulatory framework that distinguishes between token types and provides predictable rules of the road for innovators and intermediaries. This posture signals a deliberate shift toward embracing digital finance innovation and accommodating tokenization within regulated markets. Traditional institutions, from large banks to asset managers to major infrastructure players like the DTCC and NYSE, are bringing tokenized assets mainstream.

SEC soliciting policy recommendations for 45th Annual SEC Small Business Forum

Mark your calendars: The 45th Annual SEC Small Business Forum is back with opportunities to improve capital formation for public and private startups, small companies, and their investors. Members of the public can propose and vote for policy recommendations, which will be reported directly to Congress. Several bipartisan efforts originate from the innovation suggested in this forum. You can submit your policy recommendations by 12:00 p.m. ET on March 5.

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