TLDR:
- The CLARITY Act passed the House with 78 Democratic votes but remains stalled in the U.S. Senate after ten months.
- Binance clears nearly 40% of global spot crypto volume while Coinbase, the top U.S. exchange, handles only 6%.
- Senators Gallego and Torres are pushing crypto legislation to serve working-class Black and Latino constituents.
- Tokenization on public blockchains could extend American financial products to billions of people who lack U.S. brokerage access.
The CLARITY Act remains stuck in the U.S. Senate despite strong bipartisan support in the House. Mike Novogratz, founder of Galaxy Digital, is urging Democrats to act on crypto regulation.
He argues that inaction is pushing American crypto activity offshore. With 55 million Americans owning crypto, the stakes for U.S. financial leadership are high.
The longer the Senate delays, the more ground the U.S. cedes to rival financial hubs like Singapore, Dubai, and London.
Senate Inaction Drives Crypto Activity Offshore
The CLARITY Act passed the House last July with backing from 78 Democrats. However, the bill has not advanced in the Senate, leaving American crypto companies without clear legal footing. Novogratz points to this regulatory vacuum as a key driver of offshore activity.
Binance, which holds no formal headquarters but operates under an Abu Dhabi license, now clears nearly 40% of global spot crypto volume.
Meanwhile, Coinbase, the largest U.S.-based exchange, handles roughly 6%. The gap between these numbers tells the story clearly.
The U.S. poured $2.4 trillion into crypto markets in a single year — nearly four times the next country. Yet without domestic rules, that capital flows through foreign platforms.
Senator Kirsten Gillibrand crossed party lines in 2022 to introduce a bipartisan crypto framework. Writing on X, Novogratz noted that “the Senate’s job now is to finish it.”
Novogratz frames the delay not as a policy disagreement but as a posture problem. A vocal segment of the Democratic caucus views crypto legislation as a corporate giveaway. That view, he says, is producing the opposite of its intended effect — an unregulated offshore market.
Democratic Lawmakers and Tokenization Could Redefine U.S. Financial Power
Senator Ruben Gallego, Arizona’s first Latino senator, took up crypto policy directly because his constituents were asking about it. Many of them are working-class, Hispanic, or Black Americans with a growing interest in digital assets.
In a statement referenced by Novogratz, Gallego made his position clear: “If your constituents are showing interest in this, then you should show interest in it too.”
Representative Ritchie Torres, who grew up in public housing in the Bronx, represents one of the poorest congressional districts in America.
He has publicly argued that blockchain technology can “liberate the lowest income communities from the high fees of the traditional financial system.” Both lawmakers are actively legislating while much of the caucus remains on the sidelines.
Beyond domestic regulation, Novogratz sees a larger opportunity in tokenization. Public blockchains could allow American equities, Treasury bonds, and investment funds to reach billions of people globally who will never open a U.S. brokerage account. The CLARITY Act could make that possible.
Passing the bill, Novogratz argues, is not just a financial decision — it is a projection of American economic power. Countries like Singapore and the UAE are already moving.
Novogratz put it plainly: “Pass the CLARITY Act. Show up. This is how Democrats win. This is how America wins.” The U.S. has the capital markets, the demand, and the legal infrastructure to lead. What it needs now is legislative follow-through.
