CLARITY Act defeat shifts crypto rulemaking to SEC and CFTC

The Digital Asset Market Clarity Act failed to advance in the Senate, falling short of the 60 votes needed to clear a procedural hurdle (49-50), and the White House says the bill is unlikely to pass in the lame-duck session — leaving rulemaking to regulators. The SEC opened its five-year Innovation Exemption for tokenized stock venues, proposed a crypto custody rule, and the CFTC proposed its first comprehensive crypto framework, matching what SEC Chair Paul Atkins and CFTC Chair Michael Selig have said: the agencies will act with or without a bill.

Executives see the defeat unlocking faster commercial progress — KBW's Paul McCaffery expects a wave of M&A, Bitwise CIO Matt Hougan calls the agency approach favorable short-term, and Temporal and Flow Traders point to 24/7 onchain trading advancing — while lawyers warn that unleveraged spot-market oversight and durable certainty remain unresolved without Congress. Immediate market reaction saw XRP sink 10% and bitcoin slide toward $76,000.