Trump's crypto advisor pressures Congress: CLARITY Act becomes a key battle in U.S. crypto regulation

January 21 News, as U.S. cryptocurrency regulation enters a critical window, core crypto advisor to the Trump administration Patrick Witt publicly called on all parties in Congress to reach a compromise on the CLARITY Act as soon as possible to promote the establishment of a unified regulatory framework for the U.S. cryptocurrency market. Witt emphasized that a digital asset industry worth trillions of dollars cannot operate long-term without a clear regulatory framework, which is also the practical reason why U.S. crypto policy must be accelerated.

Currently, the Senate is engaged in a battle over how to divide regulatory authority between the SEC and CFTC regarding cryptocurrencies, stablecoins, and DeFi protocols. Some crypto lobbying groups worry that the current draft imposes too many restrictions on stablecoin issuance and decentralized finance, potentially weakening America’s competitiveness in blockchain innovation. However, Witt believes that rather than waiting for a “perfect version,” it is better to pass an executable crypto regulatory framework during the window when Trump is in office and the Republican Party controls Congress.

He also specifically criticized Brian Armstrong’s stance of “preferably no bill,” pointing out that abandoning the legislative opportunity now could lead to a future Democratic-led version that is even more unfavorable to the crypto industry. In the U.S. crypto policy battle, the CLARITY Act is seen as the core infrastructure for the legalization and institutionalization of digital assets, directly affecting the compliance status of Bitcoin, Ethereum, and stablecoins within the U.S. financial system.

Political factors are also amplifying the urgency of this legislation. With the 2026 midterm elections approaching, all House seats and some Senate seats will be up for re-election. Polymarket data shows a 78% chance that the Democrats will retake the House, meaning if the bill cannot pass during the current window, the difficulty of advancing crypto market structure legislation will significantly increase.

For investors concerned about Bitcoin regulation prospects, stablecoin policies, and the direction of the U.S. crypto market, the CLARITY Act not only determines regulatory jurisdiction but also influences whether institutional funds will continue to enter the digital asset space on a large scale. Against the backdrop of ongoing global capital attention to U.S. crypto compliance, this battle involving the Trump administration, Congress, and the crypto industry is becoming the core battleground for crypto policy in 2026.