Senate Rejects Crypto Regulation Bill Amid Market Pressure

The US Senate's attempt to pass comprehensive federal market structure legislation for the crypto industry has hit a major roadblock. The Digital Asset Market Clarity Act, which aimed to provide clarity and regulation for digital assets, failed to advance after falling short of the required 60 votes. This leaves little time for lawmakers to revive the legislation before the November midterm elections.

Over 40 senators voted against advancing the bill, with many opposing its ethics provisions and restrictions on state enforcement powers. Banking groups also continued to express concerns over parts of the legislation dealing with stablecoin rewards. Despite Senate Republicans releasing a revised version of the Clarity Act incorporating 126 substantive changes requested by Democrats, the bill ultimately failed to gain enough traction.

The failure of the Clarity Act has sent shockwaves through the crypto market, with Bitcoin slipping toward $76,000 and Ether falling below $2,400. The move comes as markets are pricing a high probability of a quarter point rate increase by the Federal Reserve, adding further pressure on risk assets.