Key Takeaways
- • Mike Novogratz, CEO of Galaxy Digital, predicts the CLARITY Act (Digital Asset Market Clarity Act) will achieve the 60-vote threshold needed for Senate passage, with a floor vote potentially occurring as early as next month.
- • The bill's primary obstacle—ethics provisions governing whether rules apply to President Trump—has been resolved following agreement between Senators Cynthia Lummis (R-WY) and Bernie Moreno (R-OH) on White House language regarding presidential ethics compliance.
- • The compromise mechanism mirrors the Laken Riley Act framework: it prohibits state attorneys general from suing the president or Congress but permits them to sue the Department of Justice if enforcement is inadequate, with Democrats expected to back this DOJ-enforcement structure.
- • Passage probability remains contested internally; while Novogratz expresses confidence, Galaxy's head of research Alex Thorn has reduced his year-end passage odds to 30%, contrasting with Coinbase CEO Brian Armstrong's continued optimism and public statement that the Act is at the "one-yard line" for a full Senate floor vote.
- • Galaxy Digital (GLXY) stock declined 6% on Friday, with retail sentiment on Stocktwits remaining neutral despite industry momentum among 200+ crypto firms actively urging Senate action.
Summary
Mike Novogratz, CEO of Galaxy Digital, stated on the "All Things Markets" podcast that the CLARITY Act will clear the Senate's 60-vote threshold required for passage. Speaking with Anthony Scaramucci, Novogratz detailed the compromise he believes will facilitate passage: a resolution of the bill's ethics provisions, which have presented the primary legislative hurdle for weeks.
The ethics dispute centered on whether the CLARITY Act's provisions would apply to President Trump, whose family maintains significant cryptocurrency holdings. This obstacle was substantially addressed when Senators Cynthia Lummis (R-WY) and Bernie Moreno (R-OH) reached agreement with the White House on language governing presidential ethics compliance. According to Novogratz, the compromise adopts a framework modeled on the Laken Riley Act, which prohibits state attorneys general from initiating litigation against the president or members of Congress but permits them to sue the Department of Justice if they believe the law is not being properly enforced. Novogratz indicated that Democrats have indicated receptiveness to this DOJ-enforcement framework and are motivated to resolve the issue, with a potential Senate floor vote occurring as early as next month.
However, consensus within Galaxy Digital itself remains fractured. Alex Thorn, head of research at Galaxy, has reduced his probability estimate for CLARITY Act passage in 2026 to 30%, signaling material skepticism regarding Novogratz's optimistic timeline. This contrasts sharply with Coinbase CEO Brian Armstrong, who has publicly stated the Act is at the "one-yard line" and ready for a full Senate floor vote following months of negotiations. Galaxy Digital stock traded down 6% on Friday, with retail sentiment tracked on Stocktwits remaining in neutral territory. Institutional support for the measure remains robust, with over 200 cryptocurrency and blockchain firms formally urging Senate action on the legislation.
The ethics dispute centered on whether the CLARITY Act's provisions would apply to President Trump, whose family maintains significant cryptocurrency holdings. This obstacle was substantially addressed when Senators Cynthia Lummis (R-WY) and Bernie Moreno (R-OH) reached agreement with the White House on language governing presidential ethics compliance. According to Novogratz, the compromise adopts a framework modeled on the Laken Riley Act, which prohibits state attorneys general from initiating litigation against the president or members of Congress but permits them to sue the Department of Justice if they believe the law is not being properly enforced. Novogratz indicated that Democrats have indicated receptiveness to this DOJ-enforcement framework and are motivated to resolve the issue, with a potential Senate floor vote occurring as early as next month.
However, consensus within Galaxy Digital itself remains fractured. Alex Thorn, head of research at Galaxy, has reduced his probability estimate for CLARITY Act passage in 2026 to 30%, signaling material skepticism regarding Novogratz's optimistic timeline. This contrasts sharply with Coinbase CEO Brian Armstrong, who has publicly stated the Act is at the "one-yard line" and ready for a full Senate floor vote following months of negotiations. Galaxy Digital stock traded down 6% on Friday, with retail sentiment tracked on Stocktwits remaining in neutral territory. Institutional support for the measure remains robust, with over 200 cryptocurrency and blockchain firms formally urging Senate action on the legislation.
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