When Will Garlinghouse's Clarity Act Prediction Become Reality?

The crypto industry has been waiting for regulatory clarity for years, and Ripple CEO Brad Garlinghouse just threw down a specific timeline. In recent comments, the Ripple executive predicted an 80% probability that the long-stalled Digital Asset Market Clarity Act will be signed into law by the end of April 2026. But with banking and crypto sectors still at odds over crucial details, can Garlinghouse’s optimism hold up? The answer likely depends on whether negotiators can finally find middle ground on the issue of stablecoin rewards—a provision that has become the legislative deadlock’s flashpoint.

Why Garlinghouse Backs the Controversial Clarity Act

Brad Garlinghouse isn’t shy about his commitment to the Clarity Act, even if it’s not perfect legislation. During recent remarks, he argued that regulatory clarity beats regulatory chaos every time. Drawing parallels to Ripple’s own legal journey with the Securities and Exchange Commission, which established that XRP is not a security, Garlinghouse emphasized how clarity—even when hard-won—ultimately benefits the entire ecosystem. “Progress over perfection,” he stated, urging the crypto industry to accept the imperfect bill rather than let negotiations collapse entirely. His stance positions Ripple as a pragmatic player willing to compromise, which has made Garlinghouse a central figure in ongoing White House-brokered negotiations between the two warring industries.

The Stablecoin Rewards Deadlock Explained

The core issue blocking the Clarity Act’s passage is both simple and consequential: should cryptocurrency exchanges be allowed to offer rewards to users holding stablecoins like USDT, USDC, or Ripple’s own RLUSD? Banks say no. The crypto industry says absolutely yes. The legislation aims to establish a regulatory framework that clarifies whether digital assets fall under the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC). But the stablecoin rewards provision has morphed into a proxy battle between two industries with fundamentally different business models. Banks worry that if crypto platforms can offer higher rewards on dollar-pegged stablecoins than traditional savings accounts, deposits will flee the banking system en masse. Industry estimates suggest that if the stablecoin market grows to $2 trillion, U.S. banks could lose around $500 billion in deposits by 2028. Crypto platforms argue the banking sector is trying to eliminate competition and protect its deposit base through regulatory manipulation rather than by offering better products to customers.

Major Players Square Off Over Legislative Direction

The House of Representatives passed the Clarity Act last July, but the bill has been stuck in the Senate ever since. Recently, Brian Armstrong, CEO of major U.S. crypto exchange Coinbase, even withdrew support for the Senate’s draft version, declaring: “We’d rather have no bill than a bad bill.” This move signaled just how hardened positions have become. However, U.S. Treasury Secretary Scott Bessent has publicly criticized what he calls “recalcitrant actors” resisting compromise and warned that deposit drainage could cripple banks’ ability to lend to small businesses and agricultural operations. Bessent believes the compromise bill can pass “across the line this year” if both sides cooperate. President Donald Trump has echoed similar sentiment, suggesting the legislation is “close to passing.”

Negotiations Heat Up as White House Applies Pressure

The White House has been actively trying to bring both the banking and crypto industries to the negotiation table, with Ripple positioning itself as a key player in these talks. Garlinghouse’s public statements align with this diplomatic effort—he’s using media appearances to convince the crypto industry that accepting an imperfect bill now is better than risking legislative failure later. With the April 2026 deadline Garlinghouse proposed, there’s roughly two months remaining to bridge the gap. While no formal law has been signed yet, the combination of Treasury Department support, White House pressure, and industry players like Garlinghouse willing to make concessions suggests momentum is building. Whether that momentum proves sufficient remains to be seen, but Garlinghouse’s 80% prediction suggests he has received signals from negotiations that the deal is closer than the public stalemate might suggest.

What’s at Stake for the Crypto Industry

For Ripple and other crypto platforms, the Clarity Act represents more than just a regulatory victory—it represents the industry’s transition from legal limbo to a defined framework. Garlinghouse has made clear that Ripple views this legislation as essential to the sector’s long-term credibility and growth, regardless of which regulator controls which asset class. The act would provide the kind of certainty that crypto markets have desperately needed, allowing platforms to build compliant business models without fear of sudden SEC enforcement actions. As regulatory frameworks crystallize globally, the U.S. Clarity Act could serve as a model for international policymakers weighing how to govern the digital asset space. For now, all eyes remain on whether Garlinghouse’s April deadline prediction holds—and whether both industries can finally find enough common ground to move this pivotal legislation across the finish line.