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The U.S. Senate is about to conduct a procedural vote on the CLARITY Act, with a threshold of 60 votes

The U.S. Senate will conduct a procedural vote on the Digital Asset Market Clarity Act (referred to as the CLARITY Act). At 2:15 AM Beijing time on September 16, senators will decide whether to end the debate on the motion to enter the bill's review process, with a threshold of 60 votes. If the vote passes, the bill will then enter full Senate debate, amendments, and subsequent final voting, which does not equate to the bill being passed directly that night, nor does it mean it will take effect immediately.To garner bipartisan support, Senate Republicans accepted 126 substantive amendments proposed by Democrats in the final draft. The new text includes stricter ethical provisions, granting state attorneys general a clearer enforcement role; it also gives the Secretary of the Treasury the authority to intervene against potential deposit outflows triggered by payment stablecoins, and revises developer-related provisions to reduce the risk of decentralized infrastructure developers being classified as money transmission entities. Democrats are concerned that the Trump family's cryptocurrency business may create conflicts of interest, with some lawmakers hoping to add constraints such as asset divestiture or blind trusts; moderate senators like Warner and Gallego still hope to push for more amendments. Some Republican lawmakers are also under pressure from the banking industry, fearing that accounts with yield attributes linked to stablecoins could siphon off deposits from community banks.

The effect of South Korea raising the margin threshold is becoming apparent: retail investors are reducing their holdings in leveraged ETFs and turning to spot purchases

According to Daum, after South Korea's financial regulatory authorities raised the base margin for domestic and foreign single-stock leveraged products from 10 million won in securities to 30 million won in pure cash starting July 31, South Korean retail investors began to rapidly adjust their portfolios.According to data from the Korea Securities Depository, Tesla's 2x leveraged product TSLL recorded a net purchase of 14.58 million USD on August 3, but the purchase amount on the 4th plummeted from the previous day's 15.6 million USD to 1.56 million USD, while the selling amount rose to 8.68 million USD, resulting in a net sell of 7.11 million USD for the day. During the same period, Tesla's spot net purchases reached 42.3 million USD, more than five times the net purchase amount of TSLL.Micron Technology and SanDisk also showed similar divergence—Micron's 2x leveraged product flipped from a net purchase of 10.81 million USD on the 3rd to a net sell of 15.98 million USD on the 4th, while SanDisk's 2x leveraged product changed from a net purchase of 17.74 million USD to a net sell of 33.74 million USD. Meanwhile, the spot net inflows for the two companies were 148 million USD and 145 million USD, respectively, indicating a significant trend of funds shifting from leveraged tools to the underlying stocks.The tightened regulations require that the base margin must be paid in cash, with alternative securities such as stocks, ETFs, and bonds no longer counted, and existing investors must also meet the new standards when making additional purchases; selling is unrestricted, but the funds from sales must be settled after T+2 days before they can be counted as cash margin.The new rules were originally planned to be implemented in phases in August, but due to concerns that limiting it to Korean products would lead to a capital influx into overseas leveraged products like Tesla and Nvidia, creating a balloon effect, South Korean regulators moved the implementation date up to July 31 and simultaneously covered both domestic and foreign products.South Korean investors have reacted strongly, believing that extending measures aimed at local market volatility to overseas products constitutes excessive intervention, and that only South Korean investors must meet the 30 million won cash threshold, putting them at a disadvantage in global competition.
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