Senate Rejects Crypto Bill Amid Trump Dealings and Banking Lobby Opposition

The US Senate's vote against advancing the Clarity Act, a bill aimed at establishing a regulatory framework for the $2 trillion cryptocurrency market, marks a significant setback for the industry. The bill, which would provide clarity on how cryptocurrencies are classified under securities or commodities laws, was met with opposition from both Democrats and some Republicans.

The crypto industry had spent over $300 million in the 2024 and 2026 elections to push crypto policy into the mainstream, but this effort failed to sway enough lawmakers. Analysts pointed out that even though the industry has a remaining war chest of around $130 million, it's unlikely to make a significant impact without bipartisan support.

According to experts, the bill's defeat was largely due to President Donald Trump's personal crypto dealings becoming a flashpoint for Democrats and the opposition from the influential banking lobby. The latter successfully dragged out talks on the provision that could create competition for deposits, hurting lending.