Months of negotiations over the Digital Asset Market Clarity Act ended without a clear path forward after the bill encountered bipartisan resistance during a crucial Senate procedural vote earlier this month. The setback leaves the cryptocurrency industry without its preferred framework for dividing oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission.
According to CoinDesk, interviews with more than a dozen industry participants and legislative aides point to several overlapping causes rather than a single failure. Disputes over ethics, stablecoin rewards, the structure of Senate negotiations, the decision to develop a separate Senate bill and the approaching 2026 midterm election all weakened the legislation’s prospects.
The bill was intended to establish which federal regulator would oversee different parts of the roughly $3 trillion cryptocurrency market. The SEC and CFTC currently do not have clearly defined boundaries across crypto markets, while federal oversight of spot crypto trading remains incomplete. The CFTC generally lacks spot-market authority outside fraud-related matters and derivatives, while the SEC has not issued comprehensive formal rules explaining how it would regulate crypto-related securities products.
The absence of a law has led the agencies to publish joint advisories describing their views of the market. Supporters of the Clarity Act argued that legislation would provide a more durable and legally specific framework. The bill followed the GENIUS Act, which became law last year and focused specifically on federal oversight of stablecoins.
Ethics concerns became central
A provision aimed at restricting crypto-related financial ties among senior government officials became one of the most politically difficult parts of the bill. Although supporters described the language as applying to current and future presidents and other senior officials, Democratic concerns focused heavily on President Donald Trump’s crypto activities.
Those activities include World Liberty Financial, the $TRUMP memecoin and mining company American Bitcoin. Trump’s June financial disclosure said he made $1.4 billion from crypto ventures during his first year back in office, more than half of the $2.2 billion he reported earning in total during 2025, according to the source material.
Democrats sought restrictions on what they viewed as the president’s personal ability to profit from the sector. Negotiators from the White House, Senate Republicans and Senate Democrats exchanged proposals, while Sens. Thom Tillis and Ruben Gallego developed a bipartisan alternative. No agreement was reached before the floor vote.
The issue became more important as the Nov. 3 midterm election approached. Even lawmakers who had previously supported crypto legislation faced political pressure not to appear to endorse Trump’s conduct. Rep. Ritchie Torres said he believed the president’s crypto activity had created a political obstacle that otherwise might not have prevented Democrats and Republicans from reaching an agreement.
A divided legislative process
The House passed its version of the Clarity Act in July 2025 by 294 votes to 134, including support from 78 Democrats. The Senate did not simply take up that legislation. Instead, it developed its own text, initially under the name Responsible Financial Innovation Act, and later adopted the Clarity Act name.
That choice created additional uncertainty. Even if the Senate version had passed, it would have had to return to the House, which had left Washington soon after the Senate returned earlier this month. A House vote might therefore have been delayed until the post-election lame-duck session, and lawmakers would not necessarily have approved the Senate text without further review.
The Senate process also became entangled in a dispute over stablecoin yield and rewards. Coinbase Chief Executive Brian Armstrong withdrew support for the Senate Banking Committee’s version ahead of a key January vote, citing concerns about how the bill treated those products. The disagreement contributed to a months-long debate involving the crypto and banking industries.
Several participants said the delay reduced the time available for resolving other issues, including the treatment of decentralized finance and the ethics provision. Negotiations were also criticized for being conducted largely through exchanges between Republican and Democratic staff rather than through a fully shared drafting process.
A final effort involving Tillis and Gallego began as the September procedural vote approached. Some participants said the talks were close to allowing the bipartisan ethics proposal to be considered as an amendment, but the discussions ended before a deal was put on paper. Accounts differed over whether a staffer linked to Senate Banking Committee Chairman Tim Scott halted the meeting or whether formal negotiations had already concluded.
Election pressure and what comes next
The approaching election narrowed the room for compromise. Sen. Bill Hagerty said the chances of passage declined as lawmakers moved closer to Nov. 3, although he indicated the Senate could revisit the legislation after the election. The immediate result is that the crypto industry’s central legislative goal remains unresolved despite extensive lobbying and political spending.
The setback also raises questions about Fairshake, the largest crypto-focused super PAC. It has announced $30 million in spending against former Sen. Sherrod Brown, who is challenging Ohio Sen. John Husted. Industry participants disagree over whether such spending can change the broader election outcome, particularly if Democrats regain control of the House or make gains in the Senate.
The industry also faces a more basic political challenge: crypto is not a leading concern for most voters. A CoinDesk-commissioned survey of 1,000 registered voters found that only 1% identified it as a top issue. Cost of living, jobs, the economy, Social Security and Medicare ranked higher. That makes it harder for crypto advocates to persuade lawmakers that supporting market-structure legislation carries a clear benefit with constituents.
Moneyiar market picture
Moneyiar data at the given time, Sept. 25, 2026, showed mixed but generally positive weekly performance among the listed crypto assets:
- NEAR Protocol (NEAR): $4.9081066872, up 6.57% over 24 hours and 30.49% over seven days.
- Monad (MON): $0.0259233891, up 3.26% over 24 hours and 3.03% over seven days.
- Basic Attention Token (BAT): $0.090228885, down 0.82% over 24 hours but up 14.98% over seven days.
- Velo (VELO): $0.0046824646, up 0.87% over 24 hours and 7.82% over seven days.
These market figures do not change the legislative outcome, but they provide a snapshot of selected digital assets while the industry waits for greater clarity over the rules governing US crypto markets.
