The US Senate on Tuesday rejected cloture on the motion to proceed to the CLARITY Act, blocking the crypto market structure bill from reaching the floor. The effort to set up a federal regulatory system for digital assets is now on hold. The cloture motion failed 49 to 50, eleven votes short of the 60 required and one short of a bare majority. Senator Chris Coons did not vote. All Democrats present voted no, joined by Republicans Susan Collins, Josh Hawley and Jerry Moran. Thom Tillis voted yes before switching to no, a procedural move preserving his right to call the bill back.
This vote came after over a year of work on the bill, including several rounds of changes to address concerns from both parties. Senate Majority Leader John Thune called the bill the next logical step after the GENIUS Act, which Congress passed last year to set up rules for stablecoins. Democrats said the new version still did not fix their biggest concerns especially around ethics and President Donald Trump’s financial links to crypto.
Why the CLARITY Act Cloture Vote Failed 49-50
The goal of the CLARITY Act was to mention clearer rules for digital assets and split regulatory duties between the SEC and the CFTC. Both agencies handle crypto enforcement, but their approaches often clash, leaving companies confused about which rules to follow. Thune said the bill would help the SEC and CFTC cooperate and align their rules. It would also stop companies from dodging securities laws that apply to other financial assets. Thune argued that the bill protected the growing number of Americans investing in digital assets.
He highlighted support from major financial institutions and law enforcement agencies. Thune pointed to more than 100 changes made at Democrats’ request and noted that Republicans had released another revised version of the bill just last weekend. Despite all those tweaks, it still was not enough. During a procedural move, Tillis switched his vote from yes to now. Reuters said this lets him bring the bill back for another vote in the future. The Senate is expected to leave Washington this month ahead of the November midterm elections.
Also read: Blockchain Association Urges Senate to Pass Clarity Act Now
Warren and Democrats Held Out Over Trump’s Crypto Income
The main fight over the bill focused on ethics rules that were supposed to keep government officials from profiting off crypto. Senator Elizabeth Warren, a Democrat from Massachusetts, spoke out against the bill ahead of the vote. She said she could support crypto legislation backed by both parties, but said the CLARITY Act did not meet the standard.
Warren warned that the bill posed risks for families, the economy, and national security. She focused on President Trump and his family’s crypto businesses. According to financial disclosures cited in the article, Trump earned $1.4 billion in crypto related income last year, including earnings from his meme coin business and family’s cryptocurrency firm.
Warren argued the bill did not do enough to stop Trump and his family from benefiting in the industry. She called the ethics provisions weak and urged lawmakers to work on a truly bipartisan crypto bill. This disagreement became a major barrier for Democratic support. Republicans said they had already made lots of changes to address Democratic concerns, while Democrats insisted that key safeguards were missing.
Bitcoin Falls to $76,000 as Industry Reaction Stays Measured
The collapse of the CLARITY Act means crypto companies still do not have the federal market structure they wanted from Congress. The industry had invested hundreds of millions of dollars into advocating for the bill. Supporters argued that having clearer laws would give crypto companies much needed stability. After the vote, Coinbase CEO Brian Armstrong called it disappointing. He said the SEC and CFTC already have the power to write clear rules under current law and expected them to start working on it.
Without new legislation, efforts to set rules for digital assets could be affected by changing politics or legal challenges. Industry executives said only Congress can provide lasting statutory certainty, though reaction was measured because regulators are already acting. CFTC Chair Selig has instructed staff to draft a market-structure regime under existing authority, and the SEC put Regulation Crypto Assets out for comment in August. Bitcoin fell more than 5% to around $76,000 as the count came in, its steepest one-day decline since June. Polymarket odds of the bill passing this year collapsed to about 7%, from 82% in February. Shares of Coinbase and stablecoin issuer Circle each fell by as much as 10%.
In the House, lawmakers are still pushing for action. House Financial Services Committee Chairman French Hill and House Agriculture Committee Chairman Glenn Thompson said the failed vote did not change the need for clear digital asset rules. They said Congress must still provide lasting legal certainty while working with federal regulators using current authorities. With the House cancelling its weeks of September 21 and 28 and the Senate’s state work period starting October 5 ahead of the November 3 election, the next realistic opportunity is the next Congress.
