Brad Garlinghouse Projects Strong Timeline for Clarity Act: April Breakthrough Expected

Ripple CEO Brad Garlinghouse is signaling growing momentum around the Digital Asset Market Clarity Act, predicting an 80% probability of passage by the end of April. Speaking on Feb. 17, Garlinghouse emphasized that clarity—not perfection—should drive the crypto industry forward, even if the proposed legislation isn’t ideal for all stakeholders. His optimism comes as the White House intensifies efforts to broker an agreement between feuding banking and crypto sectors.

The Clarity Act faces a critical juncture. After passing the House last July, the legislation has remained stalled in the Senate due to fundamental disagreements between financial institutions and cryptocurrency platforms. At the heart of this standoff is a provision that would restrict crypto exchanges from offering rewards on stablecoin holdings—a move designed to prevent what regulators view as the creation of unregulated deposit accounts.

What the Clarity Act Actually Aims to Do

The legislation seeks to establish clear regulatory boundaries for digital assets in the United States. Specifically, it proposes dividing oversight responsibilities: the Commodity Futures Trading Commission (CFTC) would regulate assets classified as commodities, while the Securities and Exchange Commission (SEC) would oversee those deemed securities. Without such clarification, the crypto industry operates in ambiguous legal territory, creating compliance challenges and regulatory uncertainty.

The act’s framework directly impacts how major stablecoins—including Tether’s USDT, Circle’s USDC, and Ripple’s RLUSD—are treated by regulators and financial platforms. These digital currencies maintain their value through 1:1 pegging to the U.S. dollar, functioning as “digital dollars” within payment ecosystems.

The Stablecoin Rewards Controversy Blocking Progress

The legislative stalemate hinges on a single but consequential provision: prohibiting crypto platforms from offering yield on stablecoin balances. Banks fear this would accelerate deposit flight. Standard Chartered’s research head Geoff Kendrick has warned that if the stablecoin market expands to $2 trillion, U.S. and developed economy banks could experience approximately $500 billion in deposit withdrawals by 2028—a scenario with significant implications for lending to small businesses, agricultural operations, and real estate development.

The banking sector argues it needs protection from this competitive disadvantage. However, the crypto industry counters that such restrictions represent anti-competitive gatekeeping. Coinbase, America’s largest crypto exchange, withdrew support from the Senate’s draft version last month, with CEO Brian Armstrong declaring: “We’d rather have no bill than a bad bill.”

Treasury Secretary Scott Bessent has criticized what he termed “recalcitrant actors” blocking compromise. He previously warned that if deposits drain from traditional banks, these institutions will struggle to fund community lending initiatives. “We will continue to work to make sure there is no deposit volatility associated with this,” Bessent pledged. He believes the legislation can “cross the line this year,” a sentiment echoed by President Donald Trump.

Why Brad Garlinghouse Believes Now Is the Moment

As negotiations intensified, Ripple CEO Brad Garlinghouse emerged as a key advocate pushing the industry toward acceptance. Acknowledging that the Clarity Act isn’t flawless, he argued that perfectionism shouldn’t obstruct progress. “I think it’s so clear that clarity is better than chaos,” he stated.

Garlinghouse drew parallels to Ripple’s protracted legal battle with the SEC, which ultimately established that XRP is not a security—providing the clarity his own company desperately needed. That victory, he suggested, illustrates the value of regulatory certainty. While Ripple has achieved such clarity through litigation, he noted, the broader crypto ecosystem remains in regulatory fog. For this reason, Ripple is strongly backing the legislation despite reservations about certain provisions.

The April Deadline and What’s at Stake

Garlinghouse’s 80% prediction for passage by month’s end signals confidence that both sides can find middle ground within weeks. The White House has positioned itself as mediator, with Ripple playing a central negotiating role. If the deadline passes without resolution, momentum could dissipate, leaving the industry in continued regulatory limbo.

The broader implications are substantial: clarification around which federal agencies govern which assets would provide the framework crypto enterprises need to operate with confidence, while addressing banking sector concerns about deposit volatility and competitive fairness.