- The CLARITY Act failed to secure the 60 votes needed to advance in the Senate.
- The SEC and CFTC can continue providing crypto-related guidance under their existing authority.
- BTC and ETH declined following the Senate setback, adding fresh uncertainty to the market.
The CLARITY Act has faced another major setback despite widespread expectations that the crypto bill would pass the Senate this week. While the Senate held a key vote on September 15, the market structure bill did not receive the required 60 votes to move forward.
However, this failure does not mean that the US crypto industry is now left without regulatory action. US regulators, including the SEC and CFTC, have already taken steps to bring the much-needed clarity to the industry.
CLARITY Act Fails to Pass the Senate
The US Senate reportedly voted against the CLARITY Act’s progress. This has stalled the crypto bill in Congress after months of negotiations between Democrats and Republicans. Although Republicans recently introduced some changes to some of the provisions to address the existing disagreements, the revisions were not enough to gain support from Democrats.
This development came as a surprise for many in the crypto industry as they strongly expected the bill’s passage. SEC Chair Paul Atkins previously stated, “I anticipate and hope that it will be passed by the Senate and sent ultimately to the President’s desk for a signature.”
What Does This Setback Mean for Investors?
Notably, this failed vote suggests that the US crypto industry will continue to wait for clear regulatory oversight. The CLARITY Act was expected to provide a clear understanding of the industry. It was also anticipated to distinguish between the roles of the SEC and CFTC. But as the bill is now stalled, crypto companies and investors may still need to navigate the existing regulatory framework until the Senate passes the CLARITY Act.
How Can the SEC and CFTC Regulate Crypto Without CLARITY?
Despite the current setback, the US crypto market is still witnessing regulatory progress through the actions of the SEC and CFTC. As noted by Coinbase CEO Brian Armstrong, these regulators have already started working on crypto rules. “The SEC and CFTC have the tools they need to create clear rules under existing authority, and I expect will begin working on this in earnest. So clarity is coming to crypto regardless,” stated Armstrong.
The two regulatory agencies have been working closely to coordinate crypto regulation. Earlier this year, the SEC and CFTC signed a memorandum of understanding to improve cooperation. The move also aimed at reducing the difference between their regulatory approaches.
Last month, the SEC unveiled plans to launch new rules amid the CLARITY Act delays, especially focusing on investment contracts. However, these actions have limitations. While their guidelines may help in the current legislative framework, they cannot actually replace the crypto bill.
What Does the CLARITY Act Setback Mean for Bitcoin and Ethereum Prices?
The CLARITY Act’s failure to pass the Senate has already impacted the crypto market negatively. Major crypto assets like Bitcoin and Ethereum have significantly declined after the event. As of now, BTC is trading at $75,738, down 2.06%. ETH is valued at $2,399, with a 3.23% daily drop. Thus, the setback has added another layer of uncertainty to the crypto market.
What Happens Next for Crypto Exchanges and Token Issuers?
Amid current regulatory concerns, crypto exchanges are likely to keep operating under the SEC and CFTC rules. They need to wait for the Senate to pass the CLARITY Act and President Donald Trump to sign it into law.
Currently, crypto exchanges may face difficulty in distinguishing securities and commodities due to a lack of regulatory clarity. Token issuers will also have problems in figuring out whether their assets and related activities come under existing laws. DeFi platforms will also face similar challenges.
How Is the CLARITY Act Different from the GENIUS Act?
It is worth noting that the CLARITY Act and the GENIUS Act are different. While the former focuses on crypto regulation, the latter is mainly about regulating stablecoins. The GENIUS Act is about rules of stablecoin issuance, reserves, licensing, and oversight. It reportedly became law in July 2025, and the Treasury is currently working on rules to implement.
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Significantly, the CLARITY Act’s current stall is not the end of US crypto regulation. The Senators would still be able to resume negotiations and make appropriate adjustments to the bill to address their concerns. If the arguments were sorted out, the lawmakers would also possibly approve the bill and enable it to be passed.
Related: Crypto Clarity Act Fails Senate Vote, Stalling US Market Rules Push
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