US Senate rejects crypto Clarity Act after last-minute ethics dispute
Senate rejects Clarity Act in failed vote
The U.S. Senate voted down the Digital Asset Market Clarity Act on Tuesday. The Digital Asset Market Clarity Act is legislation meant to set clear rules for the crypto market. The vote failed to win the 60 votes it needed, ending months of failed effort.
The Clarity Act was the market structure bill the crypto industry had pinned its greatest hopes on, according to CoinDesk. Its defeat followed last-minute, behind-the-scenes disputes between Republicans and Democrats.
Key facts at a glance
- The Senate vote fell short of the 60 votes needed.
- Senator Cynthia Lummis worked on the bill for more than five years.
- The final fight centered on ethics rules for President Donald Trump's crypto holdings.
- Each party accuses the other of breaking off the negotiations.
- Some still hope for an end-of-year, last-ditch strategy.
What the fight was about
The dispute was about Trump's crypto holdings and ethics requirements, not about the crypto market rules at the heart of the bill.
Democrats said the bill still let Trump benefit from his own crypto holdings while his administration made decisions that could affect their value. Senator Mark Warner, a Democrat who worked on the bill's illicit-finance sections and said he really wanted to vote yes, said: “The president should not be able to use the power and influence of his office to benefit his own crypto holdings while his administration makes decisions that could directly affect their value.”
“At a minimum, any serious crypto legislation must include meaningful ethics requirements that prevent the president and other senior government officials from profiting off the policies they oversee,” Warner added.
Lummis and other Republicans said they had made their final offer, which they argued carried more concessions to Democrats, including a new agreement from Trump to accept unprecedented ethics constraints on his crypto holdings. Democrats said the offer was substantially similar to what was already on the table.
Who ended the talks
The two parties disagree on how the negotiations collapsed.
Democrats said they were still trying to keep talking down to the wire. The article reports that Republicans shut down the negotiation and proceeded with the vote.
Senator Ruben Gallego said: “Just as Democrats and Republicans were making progress to address ethics concerns, Republican leadership ended talks and forced a vote. They were never serious about bipartisan negotiations.”
Senate Minority Leader Chuck Schumer said: “As you may have heard, there was a bipartisan deal on the table as recently as this afternoon to resolve all outstanding items including ethics. Republican leadership walked into the room, broke up the bipartisan discussion and said, ‘No, we're done’ and killed it.”
The article also notes the vote did not have to happen on Tuesday afternoon. Republican leaders could have shifted it if there was still a chance for negotiations.
Confirmed facts about the vote
It is confirmed that the Senate held the vote and the Clarity Act failed to get the 60 votes it needed. Lummis, who is retiring soon, had worked on the bill for more than five years. The day before the vote, she had already sounded disappointed at a crypto event in Washington. The article also reports that Democrats, including some who had pushed for the crypto bill, ended up abandoning it.
What is still in dispute
The exact vote tally is not stated in the source, which describes the yes votes only as meager. The two parties also dispute whether a deal was genuinely close, with each side blaming the other for ending the talks.
Why the failed vote matters
The crypto industry viewed the Clarity Act as its best hope for clear market rules. According to the article, the low number of yes votes throws the effort into a tailspin.
What could happen next
Some people still hold out hopes for an end-of-year, last-ditch strategy to revive the legislation, the article says.
Where this information comes from
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