Police Chiefs Back CLARITY Act as Passage Odds Sink Below 30%

The Major Cities Chiefs Association endorsed the latest draft of the CLARITY Act on July 29, praising new tools for investigating digital-asset crimes. Polymarket still prices only a 28% chance the bill becomes law in 2026.

That split captures the week before the Senate’s August recess. Law enforcement has flipped after revisions. The ethics and DeFi fights that remain have not.

What the Police Chiefs Signed Off On

Chief Jeffrey Norman of the Milwaukee Police Department, writing as MCCA president, sent the MCCA endorsement letter to Scott and Warren on July 29. The group represents police executives from the largest U.S. and Canadian cities.

The inclusion of these provisions represents a meaningful step toward improving the ability of law enforcement to investigate financial crimes involving digital assets.

Norman signed the letter after MCCA experts reviewed the revisions. A new title adds law-enforcement language. Sections 10203, 10204 and 10309 now name state and local agencies.

The bill also studies cryptocurrency mixers, improves temporary freezes of suspicious transactions, and tightens oversight of crypto kiosks with fraud measures and consumer protections. Information sharing with financial institutions and digital-asset providers would be formalized. A federal working group on illicit use of digital assets would stand up.

Norman wrote that most provisions will not hit local agencies immediately. Still, the framework strengthens collaboration and anti-money-laundering reporting. MCCA called the package progress on investigative capability, industry accountability and victim protection.

Other Departments Lined Up Behind the Same Draft

MCCA is not alone. The National Fraternal Order of Police, which counts about 382,000 members, endorsed the revised text in late July after changes to BRCA-related language. Earlier, the National Organization of Black Law Enforcement Executives backed an earlier version. Major County Sheriffs of America withdrew outright opposition after talks.

These groups once warned that broad developer shields would hamper illicit-finance cases. The latest text satisfied enough of them to reverse or soften those positions. On X, accounts amplified the MCCA letter as proof the Senate push was real. Engagement ran into the hundreds of thousands of views within hours.

The BRCA Shield That Still Divides the Room

The Blockchain Regulatory Certainty Act language inside CLARITY remains the core fight for prosecutors and some Democrats. It shields non-controlling blockchain developers and service providers from money-transmitter status and related criminal liability when they never take control of user assets.

• Developers face prosecution only if they intend to facilitate money laundering.
• They are protected from automatic classification as money transmitters.
• The shield aims to stop aggressive readings of existing statutes that have already hit tool builders.
• Section 301 still draws a line between truly decentralized protocols and those under common control.

Coin Center has called the BRCA developer protections against money-transmitter liability its top priority and warned against last-minute stripping on the floor. Senator Catherine Cortez Masto and other Democrats, along with some prosecutors, continue to press for reforms that would remove or narrow the shield. Their version would make developers more exposed to liability for user crimes.

That tension is why MCCA’s win on investigative tools did not close the deal. The same package that brought police chiefs on board still leaves DeFi developers and enforcement hawks at odds.

Ethics Language Keeps Senators on Opposite Sides

Ethics rules for officials and digital assets form the other blockage. Revisions would bar covered individuals, including the president, vice president, members of Congress and judges, plus spouses, from issuing or sponsoring digital assets for compensation until early 2029. Divestiture or blind-trust options appear for certain holdings.

Senator Thom Tillis has driven a bipartisan ethics package with Democrat Ruben Gallego. Reports indicate they reached new common ground, yet Democrats led by Cortez Masto still call the language short on consumer protection, illicit finance and conflicts. Tillis has signaled he will vote no without further changes. The Tillis ethics package push before recess remains live but unfinished.

Punchbowl News and other reporting note Democrats have not ruled out a procedural vote before recess. They are unlikely to supply the needed votes without an ethics amendment they accept. An earlier crash in CLARITY Act odds tracked the same ethics standoff.

How the Odds Got Here

The House passed H.R. 3633 Digital Asset Market Clarity Act on July 17, 2025, by 294-134, with 78 Democrats joining every voting Republican. Senate Banking marked it up in May 2026 under Chairman Tim Scott. It sits on the legislative calendar.

Polymarket volume on the 2026 signing question has topped $3.4 million. The crowd currently assigns a 28% chance of 2026 enactment. That is down from peaks above 80% earlier in the year and from the high 30s only days ago.

• Peak earlier 2026: above 80%
• Late July swing: mid-to-high 30s
• Current: 28% Yes
• Resolution: signed by both chambers and the president by Dec. 31, 2026

Majority Leader John Thune has prioritized other items, including Russia sanctions and nominations. The practical window before the Aug. 7-8 recess is measured in days. Crowd commentary on X notes the schedule squeeze and resistance from figures such as Senator Josh Hawley. JPMorgan has warned that prolonged delay itself pressures crypto markets.

What Changes for Investigators If Nothing Moves

Even without final passage, the process has already rewritten the enforcement conversation. Local and state agencies now appear explicitly in draft sections they previously lacked. Mixer studies, freeze authority and kiosk rules sit in the text. Information-sharing channels with private firms are sketched out.

If the bill dies or slips past 2026, those tools stay on the shelf. Prosecutors keep arguing for broader developer liability. Industry keeps warning that ambiguity drives builders offshore. If a compromise passes later, the LE provisions MCCA celebrated would likely travel with it, because they already command bipartisan and police support.

The irony is structural. Concessions that converted police chiefs into endorsers also locked in the enforcement-heavy frame that keeps some Democrats and prosecutors demanding more. Developer shields that industry calls existential remain the price of their support. The Senate clock does not care which side feels vindicated.

Next week is the last scheduled chance before members leave. A procedural motion could still appear. Without an ethics deal Tillis and enough Democrats can live with, and without a BRCA truce, the 28% market price looks consistent with the calendar.

The chiefs have their letter on the record. The odds still run the other way.