Wall Street's Hunt and Silicon Valley's Backstabbing: The Power Play Behind the CLARITY Act!

In Washington D.C. in February 2026, the air is thick with a bloody scent that only appears when massive wealth is about to change hands.
Just last month, Coinbase's Brian Armstrong extremely rarely slammed the table right before a Senate hearing, announcing the withdrawal of support for the Digital Asset Market Clarity Act (CLARITY Act). This is not just a legislative deadlock; it signals the complete breakdown of the two-year "honeymoon" between Silicon Valley's crypto newcomers and Wall Street's old money. This is not some noble act to "protect investors"; it’s purely a street fight over who gets a slice of the $33 trillion stablecoin transaction flow.

CLARITY Act: From "Savior" to "Trojan Horse"
If the initial version passed by the House in July 2025 was a olive branch extended to the crypto world, then the amendments inserted by the Senate Banking Committee in early 2026 are a dagger coated with deadly poison on that olive branch.
The original script was perfect: the CFTC takes jurisdiction over Bitcoin and Ethereum, the SEC loosens its grip, and everyone happily rings the Nasdaq bell. But Wall Street bankers clearly don’t intend to let these hoodie-wearing programmers pass so easily.
The current deadlock centers on a group of old-timers in the Senate, surrounded by banking lobbyists, who suddenly added several "poison pill" provisions that could suffocate the industry.
Most ironically, they not only want to ban stablecoin issuers from paying interest to users but also attempt to de facto ban tokenized securities (Tokenized Equities) on the blockchain. This move is a "desperate measure," directly cutting off the core blood vessel of crypto finance (DeFi) feeding back into traditional finance.
The bankers’ logic is simple, crude, and arrogant: if I can only give 0.01% interest on a savings account, why should you get 5% backed by government bonds? Since I can't compete with you, I’ll make you illegal through law.
This is what they call "fair competition"—a fairness after breaking the opponent’s legs. Even more absurd are the regulatory clauses targeting DeFi.
The new bill attempts to redefine "DeFi intermediaries," meaning that developers who only write code and do not touch user funds might be forced to register as broker-dealers. It’s as ridiculous as requiring road builders and bridge constructors to be responsible for every car accident on the bridge.
This is not regulation; it’s designed to let decentralized finance collapse under the weight of compliance costs, forcing all liquidity back into the arms of JPMorgan and Goldman Sachs.

The Aftermath of the GENIUS Act and the "Siege" of Stablecoins
While the CLARITY Act remains in limbo, the half-year-old GENIUS Act is playing out another absurd drama. This seemingly wise-sounding law has actually turned the stablecoin market into a giant besieged city. Although its requirement for 1:1 asset reserves appears to increase security, it actually grants fraudsters a "legal license." New York State Attorney General Letitia James recently issued a public letter exposing this cover-up. She pointed out that the lack of mandatory recovery provisions for fraudulent funds in the GENIUS Act has given giants like Tether and Circle an "excuse for legal inaction" when facing stolen funds. Tether even had to create a special "USAT" brand for the U.S. market to comply, while Circle continues to enjoy high yields on government bonds while resisting law enforcement freezing requests.
This creates an extremely bizarre incentive mechanism: as issuers, freezing hacker funds benefits them nothing; instead, leaving the money on-chain to keep flowing or even freezing it but continuing to earn interest on underlying assets is the most profitable choice. This is not a victory for regulation; it’s a celebration of legal robbery.
Eric Trump and his World Liberty Financial #白宫加密会议 WLF( have made a high-profile entry at this critical juncture, loudly claiming "financial modernization." But everyone can see that this is the Trump family trying to set up a toll booth between traditional finance and the crypto world. The current situation is that the compliance threshold has been raised to a level only giants and elites can cross, while the true decentralized ideal is being gradually strangled by these so-called "clarity" measures.

Only Paranoids Survive
The market is now in a state of extreme mental schizophrenia. On one hand, Bitcoin has retreated from a high of $120,000 to $80,000, shaking market sentiment; on the other hand, institutional penetration into infrastructure is accelerating. Whether it’s Coinbase’s resolute stance or Tether’s shell-shifting for survival, fundamentally they are betting on the same future—a compliant but emasculated crypto market. For investors, the next four years’ logic is very clear: don’t expect the so-called "regulatory dividends" to benefit everyone. U.S. regulation has evolved from "regulation through enforcement" to "regulation through strangulation."
In the coming months, the game between the White House, banks, and crypto giants over the CLARITY Act will determine whether DeFi in the U.S. becomes a driver of financial innovation or a synonym for underground black markets. If you don’t want to be collateral damage in the upcoming reshuffle, don’t focus on the ups and downs of those K-line charts; instead, pay close attention to the so-called "for your own good" bill texts in Washington—those are the real slaughterhouses harvesting the leeks.