Clarity Act Stalls in Senate, Coinbase Stock Takes Hit
Coinbase shares dropped by 10% on Tuesday after the Senate failed to advance the Clarity Act, which aimed to establish permanent crypto rules. The bill, which received a 50-49 majority but needed 60 votes, would have divided oversight between the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), while establishing rules for issuing, trading, and selling digital assets.
The Clarity Act aimed to answer crypto's oldest US question: whether it is a security, commodity, or something in between. The bill also addressed consumer protection, illicit finance, software developers, and state enforcement authority. However, the Senate rejected a procedural motion to advance the bill, leaving the crypto industry without the clarity it has pursued for years.
Congress is preparing to leave Washington before November's midterm elections, making another attempt at passing the Clarity Act this year highly unlikely. The failed vote does not reverse institutional adoption already underway, but it slows the arrival of a common rulebook and leaves smaller companies less able to absorb legal uncertainty than Coinbase.