JPMorgan analysts said the CLARITY Act could return for another U.S. Senate vote before the current Congress adjourns at the end of the year, despite failing a procedural vote. The possibility matters because a motion for reconsideration keeps the measure on the Senate calendar, although analysts said the window for passing it this year remains very limited.

The CLARITY Act “is not definitively dead,” JPMorgan said in a research note reported by The Block.

Senators voted 49-50 to advance the measure, short of the 60 votes required. Senator Thom Tillis, who participated in drafting and negotiating the bill, voted against it at the last moment and filed a motion for reconsideration.

Senate could reconsider the CLARITY Act

According to JPMorgan analysts, Tillis’ procedural step gives Senate Republicans an opportunity to bring the CLARITY Act back to the floor. The bill remains on the Senate calendar, allowing leadership to schedule another vote before Congress adjourns at the end of the year.

JPMorgan pointed to the GENIUS Act, which has become law after also failing its first cloture vote. Analysts said that sequence provides a precedent for a crypto bill returning for consideration after an unsuccessful procedural vote.

However, the timetable remains tight. JPMorgan estimated that about two and a half weeks of Senate work remain before the midterm elections, leaving limited room for further negotiations. A post-election “lame-duck” session could provide another opportunity to continue work on the bill.

Analysts also said key supporters may be disappointed with the course of negotiations and could be less willing to continue discussing amendments or seek additional time for the measure.

Attention may shift to the SEC and CFTC

Amid uncertainty over the CLARITY Act, JPMorgan said investors and crypto market participants may turn their attention to actions by the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission.

In JPMorgan’s assessment, the regulators can establish rules that provide crypto companies with some clarity and could help attract additional capital to the sector. Such rules, however, would have less legal durability than legislation passed by Congress because future administrations could change or repeal them, while the regulations could also face court challenges.

“While regulators’ rulemaking can put certain safeguards in place to reassure the crypto ecosystem and instill some confidence to support capital inflows, we recognize that agency rules are less durable than legislative acts,” JPMorgan analysts noted.

They said a regulator could change its own rules under a subsequent administration, while repealing a law would require a new decision by Congress.

Source: Incrypted