Overview
- The Senate failed to advance the CLARITY Act in a 49–50 cloture vote on Tuesday, preventing floor debate on the bill that sought to divide market oversight between the Commodity Futures Trading Commission and the Securities and Exchange Commission.
- Lawmakers opposed the bill for two main reasons: Democrats said its ethics language did not prevent President Donald Trump and others from profiting from crypto, and banking groups objected to provisions that would allow yield-bearing stablecoin products.
- Markets moved quickly after the vote with sharp selling in crypto-linked firms and assets, including double-digit drops in shares of Coinbase and Circle and a more than 5% intraday decline in Bitcoin.
- The House Ways and Means Committee advanced a separate Digital Asset Tax Certainty Act by a 38–5 vote the next day to clarify tax rules for small crypto transactions and other uses, while SEC and CFTC leaders said they will pursue rulemaking under existing statutes if Congress does not act.
- With Congress unlikely to revive a wide market-structure bill before the midterms, firms, lawyers and investors face short-term legal and operational uncertainty that will drive more agency action, possible litigation, and uneven adoption by banks and exchanges.