Congress has four weeks to pass the Clarity Act. Then comes the August recess. Then the midterms. And then — if you believe the people closest to the talks — nothing until 2029. Sen. Cynthia Lummis, a crucial backer, calls it a “space race” at the finish line. The industry has spent five years and a not-so-small fortune getting this far.
By now, you’ve probably heard what the holdups are. Stablecoin rewards. Protections for software developers and non-custodial platforms from money laundering reporting. The Trump family’s own crypto dealings. Then you throw in the legislative calendar (Trump has other priorities) and Black Swan events, like the passing of Senator Lindsay Graham this weekend.
The people close to the action are outwardly positive, speaking of a last-minute push to the finish line. But the market, we have to tell you, thinks otherwise. Polymarket’s contract on passage in 2026 is down to 37%, from about 75% likelihood as recently as mid-May.
It doesn’t look great, to be honest. But let’s hope for the best. The bill, while not addressing privacy technology directly, surely has implications for it. This bill is key to delineating regulation between various regulators (SEC, CFTC, etc.) and, if passed, will give banks, corporates, and treasury desks the courage to come on-chain finally.
That, in turn, will be good for privacy technology because institutions are very clear that they can’t come onchain without it. Institutions cannot operate on radically transparent ledgers where every balance and user position is part of the native architecture.
Take stablecoins. USD-backed stables are worth more than $300 billion. But this is still a drop in the bucket against the real TAM. To get corporates and (hopefully) more individuals as well to use stablecoins will require confidentiality. In other words: privacy infrastructure isn't a nice-to-have feature on top of new forms of money. It's the precondition for the new money working at all and should be built in that way.
The biggest privacy-relevant passage in the legislation is a proposed legal shield for DeFi developers known as the Blockchain Regulatory Certainty Act. Law enforcement groups and crypto foes, like Senator Elizabeth Warren, want the measure narrowed. On the other side, the lobby and a group around Senator Lummis have been arguing that developers shouldn't need a legal team to know when their code is lawful. (And Lummis is completely right.)
In the worst case, if the bill dies this month, it could go away until 2029, say its backers. That means three more years of enforcement limbo; continuing ambiguity; and probably a hit to token prices and project valuations. Ambiguity, in turn, chills the use cases that will actually drive better privacy adoption. Private payments, confidential treasuries, compliant stablecoins: these are the areas where privacy technology will matter, where ZK tech will thrive or die.
So watch the Senate for the next four weeks. The bill's fate won't just move markets. It will determine the pace at which onchain finance gets adopted, privacy tech along with it.
Privacy Roundup
Wisp, built by Lido contributors, opened its waitlist for a private AI assistant built with attested trusted execution environments designed to keep user data and prompts confidential.
Toss, a finance superapp in South Korea, began a three-month proof of concept with Optimism and Sunnyside Labs to test private won-backed stablecoin payments, using Privacy Boost to keep payments and remittances confidential.
Jumper expanded its Houdini-powered Private Swap feature to Base, allowing users to route private transfers from multiple supported chains.
Google Wallet spotlighted its open-source zero-knowledge proof libraries, which allow users to prove identity attributes such as age without revealing the underlying personal information.
Latest on Miden
Last week, we announced that we had signed an MOU with Libeara, a tokenization platform building compliant infrastructure for real-world assets and regulated financial products.
Together with Libeara, we are exploring privacy-preserving infrastructure for regulated assets moving onchain.
This is the first in a series of announcements we will be sharing in the coming weeks.
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Till next time.