After the US elections, Galaxy sees reduced chances for major crypto legislation

The Clarity Act is likely to remain stalled following the Democrats' victory in the US elections on November 3, 2026. The party has won both chambers of Congress, altering the outlook for crypto regulation in the United States. In an analysis published on November 6, Galaxy Digital anticipates little progress on major reforms in the sector. Elizabeth Warren and Maxine Waters are expected to take the lead of strategic financial committees.

In brief

• The Democrats take control of both chambers of the US Congress.
• Galaxy Digital anticipates little progress on the Clarity Act and major crypto laws.
• Elizabeth Warren and Maxine Waters are expected to lead two important financial committees.

The Clarity Act loses its chances in Congress

The election results seriously complicate the future of the Clarity Act. The bill had already failed in the Senate on September 15 with 49 votes in favor and 50 against. It needed 60 votes to pass this procedural step.

The Republicans held the majority in both chambers at that time. This will no longer be the case starting January 2027. The Democrats gained seven additional seats in the Senate during the elections on November 3. They also secured a majority in the House of Representatives, ending two years of Republican control of Congress.

Alex Thorn, head of research at Galaxy Digital, does not expect significant advancement of major crypto legislation under this new majority. The Clarity Act was supposed to clarify the roles of the SEC and CFTC in overseeing digital assets.

The House had passed its version of the bill in July 2025, with 294 votes in favor and 134 against. In the Senate, negotiations had long focused on stablecoin rewards, developer protections, and conflicts of interest among policymakers.

Despite several compromises, no definitive agreement was reached. The new Democratic majority may choose to revisit some provisions or work on a different project. The current text has not been officially abandoned.

Elizabeth Warren and Maxine Waters regain influence

The change in majority will have consequences for the leadership of parliamentary committees. Galaxy estimates that Elizabeth Warren could chair the Senate Banking Committee. Maxine Waters is expected to regain leadership of the House Financial Services Committee.

These two Democratic leaders have advocated for stricter regulation of crypto activities for several years. Their return to significant positions could alter legislative priorities. Galaxy also reports that House Democrats are discussing a project inspired by investor protection proposals championed by Maxine Waters in 2025.

This could serve as a basis for new legislation on the structure of the crypto market. The elections also yielded mixed results for candidates supported by the industry. According to tracking by researcher Molly White cited by Galaxy, candidates backed by crypto and AI funding committees lost nine of the twelve competitive elections whose results were known by November 4.

In contrast, the forty candidates supported in less contested districts won their elections. Several advocates for digital assets also retained their seats, including Democrats Josh Gottheimer and Ritchie Torres.

The differences between the two parties do not mean that all Democrats oppose crypto. In September, Republicans even incorporated 126 amendments requested by Democrats into their latest proposal on the Clarity Act. The compromise was not sufficient.

Crypto regulation could advance without the Clarity Act

The likely failure of a new legislative attempt does not mean that US regulation will remain stagnant. Galaxy reminds that the SEC, CFTC, and banking authorities already have powers to clarify the rules applicable to crypto businesses.

The Trump administration can continue this work during the remaining two years of its term. However, these administrative measures do not replace all the provisions that a federal law could establish.

Congress retains a crucial role in permanently setting the powers of regulators and defining the legal obligations of platforms. The new majority may also hold hearings and request documents from companies or public officials.

Donald Trump's crypto activities are among the issues likely to receive more attention. World Liberty Financial, its USD1 stablecoin, and the financial ties between the presidential family and several foreign investors could be subject to new investigations.

These potential procedures remain distinct from the adoption of the Clarity Act. Democrats will also need to consider the position of pro-digital asset lawmakers within their own ranks.

For the industry, upcoming discussions may therefore focus more on consumer protection, conflicts of interest, and the powers of oversight authorities.

The Clarity Act has not yet received a new vote date. Meanwhile, Democrats are already preparing investigations into the Trump family's crypto activities. In Washington, the sector will now have to deal with a Congress less favorable to some of its priorities, without completely eliminating all possibilities for compromise.