The US Senate Banking Committee passed the crypto framework CLARITY Act yesterday.

Now, the bill, for which the crypto industry has heavily lobbied since it was introduced in 2025, will head to the Senate floor for a broader debate. 

As Cointelegraph reported, over 100 amendments were proposed while lawmakers hashed out the exact language of the bill. These covered a wide range of issues, including ethics, AI sandboxes and stablecoin yields.

But many of these fell apart. While two Democrats joined with their Republican colleagues, the vote was mainly along party lines. 

The chances for the bill to pass look good, with nearly all Republicans and some Democrats supporting, but increasing partisan gridlock ahead of the elections could still delay passage. 

CLARITY gets out of committee on party lines

After yesterday’s session, Senator and committee chairman Tim Scott announced “a successful bipartisan markup” in advance of the bill proceeding to the Senate floor.

Scott speaks at the markup session. Source: US Senate

“After nearly a year of good-faith bipartisan negotiations, Senate Banking Committee Republicans and Democrats came together today,” he said.

While the tone of Scott’s announcement leaned on supposed bipartisanship, the actual vote was mostly split along party lines. All 13 Republican members of the committee voted to advance the bill. All but two Democrats voted against, save for Senators Ruben Gallego and Angela Alsobrooks.

Contrary to Scott’s message of bipartisanship, Senator Jack Reed stated that Republicans arbitrarily dismissed Democrats’ concerns about the bill, which ranged from how crypto could enable crime to the president’s use of crypto projects for personal enrichment. 

Indeed, the minority released a brief after the vote, outlining its concerns. They stated that the current version, as passed by the majority, fails to adopt global anti-money laundering standards, exempts DeFi protocols from financial standards and doesn’t close loopholes for crypto mixer services. 

Related: Who supports CLARITY on the US Senate Banking Committee?

While there are clearly some pro-crypto Democrats in Congress, whether the bill can progress depends on them crossing the aisle to vote against their own party. 

Currently, the Republicans hold a 53-seat majority in the 100-seat Senate. To pass CLARITY, they’ll need 60 votes, so at least seven Democrats willing to vote with them. 

Republicans (red) hold a 53-seat majority in the Senate.

At the Wyoming Blockchain Summit last year, Scott said that there were 12 Democrats open to the market structure bill, giving Republicans and the crypto lobby what they need to cross the line.

But that may not ring as true now as it did then. The Congressional Progressive Caucus announced opposition to any bill which could “allow the President and his family to enrich themselves, engage in corruption, and sell access to the White House through cryptocurrency.” Notably, CLARITY’s current draft does not contain any such provisions. 

Progressive groups have called on lawmakers to address these concerns. A group of organizations including Americans for Financial Reform, Demand Progress Action, Indivisible and Public Citizen wrote a letter on May 8.

“A bill without strong ethics provisions elevates the dangers of cheating consumers and investors, distorting and destabilizing financial markets, hindering competition, eroding longstanding investor protection laws, and making a mockery of regulatory enforcement,” they said.

Ryan Cooper, a senior editor at progressive politics publication The American Prospect, even suggested that Democrats who voted with the crypto industry ought to be primaried. “Allowing yourself to be bought by the crypto lobby is unforgivable,” he wrote. 

Ethics could represent a politically volatile and important sticking point as the bill is debated on the Senate floor. 

Industry still optimistic 

Despite the largely partisan vote and the lingering ethics concerns, the crypto industry was largely optimsitc about the May 14 markup session. 

Javier Martinez, CEO and former chief legal officer at crypto trading platform sFOX, said the vote represented a “major step toward resolving crypto’s regulatory identity crisis in the United States.”

Congress is “moving toward replacing regulatory ambiguity with a more defined legal framework. And markets respond to clarity,” he told Cointelegraph.

Ji Hun Kim of the Crypto Council for Innovation said the vote will make the US more competitive in the digital asset space. CLARITY will “ensure that our country leads when it comes to digital assets policy and innovation,” he said. 

Blockchain investors and Blockstreet chief operating officer Kyle Chasse said, “This is the biggest regulatory moment in crypto since spot ETFs.”

Notably, the bill was held up for months as the banking and crypto lobbies argued over whether stablecoins could bear yields. Banks claimed this could lead to a critical flight of deposits, endangering financial stability, while crypto accused banks of stifling competition.

The version that passed markup last night sided with the banks, but would still allow crypto platforms to offer other activity-based rewards.

Even then, pseudonymous crypto trader 10 Delta said, “The yield ‘ban’ is cosmetic & simply something for banks to tout as a victory.” 

“It bans stablecoins from paying you interest for just holding them: the way a savings account does. But it explicitly allows stablecoins to pay you rewards for using them: buying things, lending, providing liquidity, participating in any program.”

Ultimately, the focus is still on the market. Alexander Lorenzo, founder and chief investment officer of CoinPicks Capital, said, “The last crypto bill to clear this exact process was the GENIUS Act in July 2025. Bitcoin hit an all-time high of $123,000 within weeks.”

“CLARITY is bigger. It covers the entire crypto market, not just stablecoins.”

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Market analysts say Ether (ETH) faces “downside risks” that could trigger another 20% downtrend toward $1,700, new analysis said.

Key takeaways:

• Rising Ether supply on exchanges and declining ETF inflows suggested a possible ETH price drop over the coming days.
• Ether’s rising wedge pattern projected a potential 22% drop to $1,725

ETH inflows to exchanges rise

Ether’s 40% recovery from multi-month lows below $1,800 was dampened by resistance from the $2,400 level. 

Analysts have outlined several reasons for Ether’s inability to break $2,400, including “significant” inflows into exchanges, according to CryptoQuant analyst BorisD. 

The chart below shows a sharp increase in ETH reserves held on Binance to 3.84 million from 3.36 million between May 5 and May 9. 

The analyst explained that as inflows accelerated, the “price action failed to show strong continuation to the upside,” dropping 7% to $2,260 from $2,390 over the same period.

“This suggests that liquidity was being both absorbed and distributed within the range,” BorisD said, adding:

“The broader structure still points toward downside risk remaining dominant for now.”

ETH exchange reserve on Binance. Source: CryptoQuant

While other analysts see potential for fresh upside in the coming days, “those moves may primarily serve distribution purposes rather than signal the start of a strong bullish trend,” the analyst added. 

Making the same observations, fellow analyst PelinayPA said any short-term rebound in ETH would be “followed by high volatility, and then a continuation of the broader downtrend,” adding:

“The large amount of ETH being moved onto exchanges continues to create significant resistance against upward price movements.”

This coincided with sharp exchange inflows, as the Ether net position change among exchanges rose to 585,000 ETH on May 13, marking the largest spike since December 2025, when ETH was trading at $3,000. This preceded a 42% drop to $1,750 in February.

ETH: Exchange net position change

Such inflows typically indicate distribution by large holders, who move tokens from cold storage or redeem ETH investment products.

Meanwhile, demand for spot Ethereum ETFs continues to decline, with these investment products recording outflows for four consecutive days, totalling $190 million. This points to a drop in demand from US investors, adding to Ether’s headwinds.

Spot ETH ETFs flows chart. Source: SoSoValue

Ether’s rising wedge targets $1,725

The daily chart shows ETH/USD validating a rising wedge breakdown, after the price breached the support provided by the lower trend line of the pattern at $2,280.

A daily candlestick close below this level will confirm the breakdown, clearing that path for Ether’s drop toward the wedge’s measured target at $1,725, representing 22% decline from the current price. This coincides with its previous macro low reached on Feb. 6. 

ETH/USD daily chart. Source: Cointelegraph/TradingView

Rising wedges are typically bearish reversal patterns, and Ether’s break below the pattern is “starting to become a concern,” analyst ShangoTrades said in a recent X post.

Zooming out, fellow analyst CryptoBullGod said ETH could drop to $1,280, which is the measured target of a bear flag, as shown on the weekly chart below.

ETH/USD weekly chart. Source: CryptoBullGod

The military government of Myanmar released the text of a bill aimed at combating online fraudsters, with several penalties related to cryptocurrencies and scam centers.

According to the text of the Anti-Online Fraud Bill, made public on Thursday, Myanmar’s parliament, the Pyidaungsu Hluttaw, proposed the law in response to online fraud in the country, which it said challenged its “sovereignty and stability.”

The law stated that anyone who was convicted of committing “digital currency fraud” or online fraud could face from ten years to life in prison, and possibly the death penalty.

In addition, the law set out conditions under which the death penalty would be imposed, including those related to the country’s scam centers. Anyone responsible for the death of an individual who had been coerced or exploited into committing online fraud would receive a sentence of death.

Source: Myanmar government

The proposed law and its potential penalties were some of the most severe imposed globally for digital currency fraudsters amid scam centers cropping up in areas of Southeast Asia. In January, China reportedly ordered the execution of 11 people linked to Myanmar scam centers that had been responsible for trafficking Chinese nationals.

Related: Scammers use Gmail dot alias trick to spoof Robinhood in phishing scam

International authorities have been working to combat human trafficking in scam centers that continue to con people globally through schemes like pig butchering, romance scams, fake investments and more. The US announced in April that they had worked with authorities in China and Dubai to arrest more than 200 people and shutter nine centers.

Myanmar’s military overthrew its civilian government in a 2021 coup d’état, resulting in its parliament not reconvening until March 2026 following elections the Council on Foreign Relations called “neither free nor fair.” According to a Wednesday notice, the government is scheduled to meet the first week of June and may consider the bill at that time.

Americans lost billions to crypto scams in 2025

According to an FBI report released in April, Americans’ losses from crypto-related scams were more than $11 billion in 2025 and more than $20 billion overall through online fraud. The agency cited a March executive order from US President Donald Trump, who authorized officials to work against “scam centers and cybercrime.”

“The [US Attorney’s Office in the District of Columbia] Scam Center Strike Force is investigating the worst scam compounds located in Southeast Asia,” said the FBI report. “Strike Force teams focus on identifying and pursuing key leaders—including Chinese organized crime affiliates operating in Cambodia, Laos, and Burma—to bring them to justice.”

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Myanmar’s military published a draft bill on May 14 proposing life in prison for crypto scam operators.

The draft legislation, called the Anti-Online Scam Bill, states that anyone convicted of “digital currency fraud” or running an online scam center faces a sentence ranging from ten years to life in prison.

The bill permits capital punishment for operators who use “violence, torture, unlawful arrest and detention, or cruel treatment against another person for the purpose of forcing them to commit online scams.”

Military bill targets digital currency fraud with maximum sentences

Myanmar’s military-backed parliament, which analysts describe as a rubber-stamp legislature, is next scheduled to sit in the first week of June.

The bill is the first piece of legislation introduced by the new government led by coup leader Min Aung Hlaing, who assumed the civilian presidency last month.

Internet fraud compounds have become a major regional crisis. The FBI reported that cryptocurrency-related fraud losses in the United States reached $11.4 billion in its most recent crime report, with more than half of all internet crime losses tied to crypto schemes. Many of the networks behind those losses operate out of Southeast Asian compounds.

US authorities have escalated enforcement pressure. The DOJ froze $701 million in crypto tied to global scam networks in April 2026, naming Myanmar and Cambodia-based compounds that rely on trafficked or coerced workers to execute large-scale fraud.

The scale of Myanmar’s operations is well-documented. Chainalysis found that romance scammers operating from the KK Park compound in Myawaddy alone siphoned nearly $100 million in crypto from global victims between 2022 and 2024.

The bill is part of a broader regional shift. Cambodia adopted anti-fraud legislation in March 2026 with prison sentences up to 10 years for ringleaders. Singapore plans to launch a dedicated Cyber Command enforcement unit in July 2026.

Cryptocurrency ATM company Bitcoin Depot reported “substantial doubts” about the company’s ability to continue operating amid ongoing litigation and a challenging regulatory environment.

In a Form 10-Q filing with the US Securities and Exchange Commission (SEC) on Tuesday, Bitcoin Depot chief financial officer David Gray reported that the company had accrued more than $20 million in legal judgments in the fourth quarter of 2025 and “ongoing litigation matters.” The company also reported “substantial year-over-year declines in revenue” amid US states and municipalities passing laws and regulations banning or restricting crypto ATMs.

“As a result of these factors, management has concluded that substantial doubt exists about the Company’s ability to continue as a going concern,” said the report.

Source: SEC

The litigation affecting Bitcoin Depot included $1.9 million paid to Maine’s Consumer Credit Protection Bureau in January, with the company facing additional lawsuits from Massachusetts, Iowa and other state-level authorities. Individual municipalities have also been passing ordinances or laws restricting crypto kiosks and ATMs amid concerns that residents may be victims of scams.

Related: Crypto ATM losses surge 33% in 2025 as AI superpowers scams: CertiK

According to its SEC filing, Bitcoin Depot reported that its revenue decreased by $80.7 million for the three months ending March 31 compared to that in the first quarter of 2025, “primarily due to a decrease in transaction volume driven by a combination of regulatory impacts and enhanced compliance controls.” The company also reported a net loss of $9.5 million over the same period.

In March, Bitcoin Depot appointed Alex Holmes as CEO, replacing Scott Buchanan, who served in the position for three months. Holmes was the CEO of MoneyGram from 2016 until 2024, where, according to Bitcoin Depot, he had a reputation for “global regulatory compliance.”

Shares of Bitcoin Depot on the Nasdaq under the ticker BTM declined by more than 40% in the previous five days, from $5.01 to $2.93.

Canada weighing countrywide crypto ATM ban

In April, the Canadian government released its Spring Economic Update for 2026, which said policymakers “propose to ban crypto ATMs” in response to scammers and criminals using the machines for money laundering. Under the proposal, Canadians would still be allowed to buy digital assets from brick-and-mortar money services businesses.

Bitcoin Depot reported to have about 220 machines deployed across Canada at the time of publication.

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The Republican chair and Democratic ranking member of the US House of Representatives Committee on Agriculture have called on President Donald Trump to fully staff the leadership at a key financial regulator, citing the potential impact of a crypto market structure bill.

In a Friday letter to Trump, House Agriculture Committee Chair Glenn Thompson and ranking member Angie Craig asked the president to “nominate a full panel” of bipartisan leaders for the US Commodity Futures Trading Commission (CFTC). The representatives cited “urgent regulatory issues” facing the US regulator in addition to a “significant rulemaking process” required if the Digital Asset Market Clarity Act (CLARITY) becomes law.

“Ensuring the Commission is well-equipped as the leading derivatives markets regulator in the world is a bipartisan priority for the members of our Committee,” said Thompson and Craig. “A complete commission will allow the agency to best fulfill its mandate of promoting integrity, resilience, and vibrancy of US derivatives markets and will advance US leadership.”

Source: US House Agriculture Committee

Michael Selig is currently the sole commissioner at the CFTC, taking over after the resignation of acting chair Caroline Pham in December 2025. Under Selig, the commission has taken many positions aligning with the administration’s policies, including claiming “exclusive jurisdiction” over prediction markets.

Related: CFTC no-action letter eases event contract reporting rules

In an April hearing with the House Agriculture Committee, Selig said he had no intention of “slow[ing] down” on rulemaking, despite the lack of four other commissioners. The CFTC chair signed a memorandum of understanding with the US Securities and Exchange Commission in March to coordinate oversight of markets, including digital assets.

The CFTC under the CLARITY Act

On Thursday, lawmakers in the Senate Banking Committee voted to advance the CLARITY Act, setting the bill up for a potential floor vote in the chamber. The bill, expected to give the CFTC more authority in overseeing and regulating digital asset markets, would have significant implications for crypto users and companies.

Although the Senate had not scheduled a vote for the bill as of Friday, the dearth of leadership at the CFTC hasn’t gone unnoticed by lawmakers considering crypto market structure. Democratic Senator Amy Klobuchar, who sits on the Senate Agriculture Committee, proposed an amendment to the bill in January requiring that it not take effect “until at least four [CFTC] commissioners” were nominated and confirmed.

As of Friday, Trump had not publicly announced any picks for CFTC commissioners. Any nominations would likely need weeks or months to move through the Senate for consideration and potential votes.

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