Shutdown Odds Surge as CLARITY Act Stalls in Congress

Shutdown risks are rising in Washington as negotiations around the CLARITY Act grind to a halt, deepening divisions on Capitol Hill just weeks before key funding deadlines

On Polymarket, traders now put the chances of a shutdown before the end of January at 78%, a sharp increase driven by stalled budget talks. These delays could also slow progress on the CLARITY Act, which depends on Congress staying in session.

President Donald Trump added to the uncertainty by saying the U.S. could “probably” face another shutdown. Senate Majority Leader Chuck Schumer also warned that Senate Democrats would block the current funding bill if it includes money for the Department of Homeland Security (DHS).

Schumer criticized the bill, saying it does not do enough to prevent abuses by Immigration and Customs Enforcement. He said he would not support the bill in its current form, making a deal harder to reach.

Crypto Bill Faces Delays as Shutdown Fears Grow

The situation is similar to last year’s shutdown, which lasted 43 days and delayed several crypto-related bills, including the CLARITY Act. That history is increasing concerns that the same thing could happen again.

Crypto industry leaders are also unhappy with the current draft of the CLARITY Act. Coinbase CEO Brian Armstrong recently pulled his support, saying it is better to have no law than a poorly written one. Galaxy Digital’s research head, Alex Thorn, said lawmakers are still divided, especially on issues like yield-bearing stablecoins. U.S. banking groups argue that these stablecoins could hurt traditional banks, which has slowed agreement.

Because of the political uncertainty, markets are staying cautious. Bitcoin prices have reacted to the shutdown risk and other political developments. Adding to the pressure, Trump also warned Canada of possible 100% tariffs if it strengthens trade ties with China, increasing broader market anxiety.