US Senate's Digital Asset "Clarity Act" Stalls on Procedural Vote, Crypto Prices Drop

A major US crypto market-structure proposal hit a wall Tuesday after the Senate failed to move forward with the Digital Asset Market Clarity Act, falling short of the 60 votes needed to clear a key procedural step. An unofficial tally from the Senate floor webcast showed more than 40 senators voting against advancing the measure. The vote was on invoking cloture on the motion to proceed, a decision on whether to begin debate rather than approve final passage. With the November midterm elections approaching, the setback leaves little runway to restart the effort and is seen as effectively ending the Senate's market-structure push for 2026. Crypto markets sold off after the result. Bitcoin slid toward $76,000, Ether dropped below $2,400, Solana fell under $97, and XRP eased toward $1.31. The declines extended a reversal that began Tuesday morning, after early-week optimism around the bill briefly lifted prices. Senate Republicans had unveiled a revised draft on Sunday, saying it incorporated 126 substantive changes sought by Democrats. Updates included tighter ethics provisions, broader enforcement authority for state attorneys general, and adjustments aimed at addressing banking industry objections tied to stablecoin rewards. The rewrite initially boosted expectations that months of negotiations could finally produce enough Democratic votes to advance the bill. Bitcoin climbed toward $80,000 on Monday, trading around $79,600 as traders positioned for a breakthrough and the broader market rallied. The tone shifted late Monday when Senate Democrats submitted a counterproposal seeking additional changes, which Republicans rejected Tuesday morning. Senator Cynthia Lummis, a leading Republican negotiator on the bill, said Democrats had largely returned to their pre-August recess positions despite Republican concessions. Democrats' objections focused on ethics language and limits on state enforcement powers. Banking groups also continued to oppose provisions related to stablecoin rewards. Political uncertainty had already pushed Bitcoin below $77,000 ahead of the vote, wiping out much of Monday's gains. The failed procedural vote added more pressure in a risk-off backdrop: US equities fell, Treasury yields rose, and markets headed into Wednesday's Federal Reserve decision with a high probability priced for a quarter-point rate increase. Rising yields and expectations for tighter policy, combined with the stalled Clarity Act, quickly unwound the bullish setup that had driven Bitcoin toward $80,000 just a day earlier. With the Senate effort now frozen, the industry is set to remain without a comprehensive federal framework for digital asset markets, with attention turning to whether talks can restart after the midterms.