Senate Rejects Landmark Crypto Bill, Sending Bitcoin Price Tumbling

The crypto market took a hit after the US Senate failed to pass the CLARITY Act, a landmark bill meant to clarify regulations for digital assets. The bill required 60 votes to advance but fell short with 49 in favor and 50 against. Bitcoin dropped by almost 34% over the past 24 hours to below $76,000.

The CLARITY Act aimed to divide supervision of digital assets between the US Commodity Futures Trading Commission and the Securities and Exchange Commission, replacing a fragmented system that has largely been settled through enforcement actions and litigation. The bill's defeat is striking because it had undergone significant concessions from President Donald Trump, including ethics restrictions for federal officials and their spouses.

The vote was largely bipartisan, with four Republicans joining 46 Democrats in opposition to the bill. Democratic Senator Elizabeth Warren attacked the bill on the Senate floor, saying it 'fails to adequately protect investors, our financial system, and our national security.' Republican Senator Cynthia Lummis, who has led crypto legislation in the US Senate, stated that she believes the industry will have to wait until next year for clearer rules.

The failure of the bill means that regulators may step in to write new rules. The US Securities and Exchange Commission under Paul Atkins and the US Commodity Futures Trading Commission under Michael Selig have already been building a framework without Congress, and analysts expect this work to accelerate now.