John Deaton Warns CLARITY Act Could Stall Amid Midterm Election Pressure

Pro-XRP attorney John Deaton is raising alarms about the future of the CLARITY Act, cautioning that the landmark crypto legislation may fail to pass if its momentum slows heading into summer. Speaking on the Paul Barron Network, Deaton emphasized the urgency of advancing the bill now, particularly as geopolitical tensions surrounding the U.S.-Iran conflict threaten to divert congressional attention.

Deaton's concern centers on the political calendar. Once summer arrives, lawmakers are expected to shift their focus toward November's midterm elections, leaving little room for complex legislation like the CLARITY Act. He further warned that the bill's fate could worsen post-midterms if Democrats reclaim control of both the Senate and House. A Democratic sweep would place Senator Elizabeth Warren — a well-known crypto critic — at the helm of the Senate Banking Committee, potentially blocking the bill before it ever reaches a full Senate vote. Polymarket currently puts the probability of a Democratic midterm sweep at 53%.

Adding another layer of complexity is an ongoing dispute between the banking sector and the crypto industry over stablecoin yield provisions. The current bill prohibits passive stablecoin rewards, restricting earnings to activity-based yields only. While Deaton acknowledged the legitimacy of arguments supporting stablecoin rewards, he sided with Ripple CEO Brad Garlinghouse and White House crypto adviser Patrik Witt in urging pragmatism — arguing that regulatory progress should not be sacrificed in pursuit of a perfect bill.

Coinbase CLO Paul Grewal has expressed optimism that a compromise on stablecoin rewards may be within reach. Meanwhile, the Senate's markup session is anticipated this month following its recess. Polymarket data shows a 58% chance that President Trump will sign the crypto bill into law this year, reflecting cautious but real optimism within the industry.