Significant progress is being made in negotiations regarding the Clarity Act, which aims to regulate the cryptocurrency market in the US. According to cryptocurrency reporter Eleanor Terrett, discussions are ongoing in Congress between Republican and Democratic senators on ethical guidelines and decentralized finance provisions.

Terrett stated that DeFi regulations were also discussed between the parties, but the biggest obstacle to the bill was the ethical provisions. A spokesperson for Senator Cynthia Lummis said that last week’s meeting with the White House was positive and that the ethics document, expected to be released in the coming days, would reflect these discussions.

However, Democratic Senator Angela Alsobrooks criticized leaving the enforcement of the ethics provisions to the U.S. Department of Justice. Alsobrooks called the White House’s proposal to enforce the ethics rules under the Clarity Act through the Department of Justice “frivolous” and said she would not support the bill if that were the only enforcement option.

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Senator Bernie Moreno explained that the current proposal would transfer the authority to impose sanctions from state attorneys general to the Department of Justice. Alsobrooks stated that the parties would continue to work to reach an agreement that would hold all officials accountable.

Alsobrooks was one of two Democratic senators who voted in May to pass the Clarity Act through the Senate Banking Committee. The Democratic senator had previously stated that his support for the bill was contingent upon the inclusion of strong ethics provisions in the final text.

Senate Majority Leader John Thune assessed the possibility of reaching an agreement on the Clarity Act. Thune said there is currently a “good chance” of reaching an agreement, but that the situation could change quickly.

Thune stated that whether the Democrats could secure enough votes to get the bill on the Senate agenda would be decisive, adding that the parties were continuing negotiations to obtain the necessary support.

According to the latest information Terrett obtained from industry sources, the White House has reached an agreement on an ethics package to be added to the Clarity Act and has sent the prepared text to some Republican senators.

*This is not investment advice.