Trump-Backed Crypto Bill Fails in Senate: Major Blow to Digital Assets

A significant cryptocurrency bill, known as the Clarity Act, has failed to pass in the Senate, delivering a major blow to the digital asset industry and Republican lawmakers, including former President Donald Trump, who championed the legislation. The measure fell short by 10 votes, securing only 50 votes against the required 60-vote threshold to advance in the 100-seat chamber.

All Senate Democrats voted against the bill, joined by four Republicans: Senators Jerry Moran, Susan Collins, Josh Hawley, and Thom Tillis.

This outcome effectively puts the legislation on ice, as lawmakers are set to depart Washington ahead of the upcoming November midterm elections. The Clarity Act aimed to establish a clear regulatory framework for digital assets, a goal that the crypto industry has heavily lobbied for, investing hundreds of millions of dollars into promoting the bill.

Former President Trump, who has reportedly gained over $1.4 billion from his family's cryptocurrency ventures, had publicly urged Congress to approve the measure. He previously sought financial backing from the crypto sector during his 2024 campaign, where he notably declared himself a "crypto president."

Critics remained unconvinced by a revised version of the bill published by Senate Republicans just days before the vote, which attempted to address concerns from the banking sector and some Democrats. The failure means that regulatory agencies like the U.S.

Securities and Exchange Commission (SEC) and the U.S.

Commodity Futures Trading Commission (CFTC) will likely step in to address the regulatory void. However, crafting lasting, business-friendly rules without a statutory framework from Congress is expected to be challenging.

Industry experts and executives emphasize that only Congress can build a permanent regulatory structure, warning that administrative rules are vulnerable to court challenges and political shifts, leaving digital asset companies exposed to long-term risks. Coinbase CEO Brian Armstrong expressed disappointment but noted that the SEC and CFTC possess the tools to create clear rules under their existing authority.

The financial markets reacted sharply to the news.

Bitcoin, the world's largest cryptocurrency, saw a drop of over 5%, marking its steepest single-day decline since June. Shares of major crypto players like exchange operator Coinbase and stablecoin issuer Circle also slid by up to 10% following the bill's failure.

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