Crypto Market Reels from Clarity Act Defeat and Brewing Interest Rate Hike
XRP plummeted over 10% to $1.30 in Asian morning hours on Wednesday, suffering the worst losses among major cryptocurrencies after the Senate failed to advance the Clarity Act.
The bill's defeat, which came on a 49-50 cloture vote, was attributed to ethics language meant to prevent senior government officials from holding crypto business interests. Senator Elissa Slotkin, a Michigan Democrat, voted against the bill, citing that the ethics provisions were 'too thin' and pointed out that President Donald Trump, his children, and Cabinet members earn money in crypto.
The Clarity Act aimed to clarify regulations for digital assets, but its failure now shifts attention to regulators, including the Securities and Exchange Commission (SEC), which is working on a proposed Reg Crypto framework. The industry's political action committees will have to decide how to treat senators who voted no before the November 3 election.
Crypto equities took a beating as well, with Coinbase falling nearly 9% to $174.42 and Circle dropping over 9% to $88.26. Bitcoin slipped nearly 3% to just above $76,000, while other major cryptocurrencies like Ethereum and Solana saw losses ranging from 5-10%.