Clarity Act Fails in Senate Vote as Crypto Industry Looks to Regulators

The Digital Asset Market Clarity Act failed to pass in the US Senate on Tuesday, coming up short of the 60 votes needed for passage.

The bill, which had been a top policy goal for the crypto industry, was defeated by a vote of 49-50. This setback is a blow to the industry's efforts to bring clarity and regulation to the market.

Negotiators had worked out over 600 pages of legislative compromise, but issues with ethics provisions proved insurmountable. Senator Cynthia Lummis made a final pitch on the Senate floor, urging colleagues to vote yes and join the digital age. However, she was unable to convince enough senators to support the bill.

The industry will now focus its attention on federal regulators, including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), which are already working on crypto rules. The SEC recently proposed a rule called Regulation Crypto Assets, or Reg Crypto, but Chairman Paul Atkins has said that without a law backing these regulations, they may not be durable.