Senate Blocks CLARITY Act, Regulators Press On

The US Senate failed to advance the CLARITY Act on September 15, after a procedural vote fell short of the required 60 votes. The bill aimed to provide clarity and regulatory framework for digital assets in the US.

The bill's failure has been met with minimal market impact, according to Galaxy Research, which notes that the digital asset ecosystem can continue to develop through direct administrative actions from federal regulators. In fact, the CFTC issued a no-action relief measure for DeFi developers and the SEC approved a five-year innovation exemption for tokenized equities.

The Senate's decision has been met with criticism from Senator Cynthia Lummis, who co-sponsored the bill, stating that the opposition's stance was unreasonable. Meanwhile, Democratic lawmakers justified their opposition by citing concerns over ethics safeguards regarding digital asset holdings by federal executive branch officials.