CLARITY Act dies in the Senate — so the SEC and CFTC are going it alone

Congress couldn't get it done. The regulators say they will.

The U.S. Senate voted 49–50 on Tuesday against advancing the Digital Asset Market Clarity Act, falling short of the 60 votes needed to move the landmark crypto market-structure bill to debate. Within a day, the heads of the two agencies that would have split oversight under the bill — the SEC and the CFTC — pledged to use their existing authority to write crypto rules anyway.

The agencies waste no time

SEC Chairman Paul Atkins was blunt in a Wednesday post on X: "I have been unequivocal: with or without legislation, we will act decisively within the SEC's statutory authority to deliver certainty for American investors and for the entrepreneurs shaping our technological future. Stay tuned."

CFTC Chair Mike Selig posted a similar message, saying the agency is "locked in and ready to ship its rules for the new frontier of finance." Selig added that President Trump had promised to deliver a crypto regulatory framework "one way or another," and the CFTC would help "get the job done using our existing statutory authorities."

Both chairs had telegraphed this pivot months ago. Atkins said in July that the SEC was "ready, willing, and able" to write crypto rules if Congress failed, and the agency released proposed rules in mid-August under a framework called "Regulation Crypto Assets." Selig said in August he had directed staff to explore rules covering crypto exchanges, trading with borrowed funds, and ways for blockchain-based finance protocols to operate legally in the U.S. — though he noted at the time that legislation remained his preferred route because agency rules are easier for a future administration to reverse.

Wall Street calls it "aggressive and swift"

Bernstein analysts said in a Wednesday note that they expect "aggressive and swift" rulemaking from both agencies, aimed at making up "for the time lost negotiating the CLARITY Act." The firm expects rules covering a token taxonomy for raising capital, developer protections for DeFi and self-custodial protocols, innovation exemptions for equity tokenization, faster approvals for real-world asset perpetual futures, and new treatment for federal sports event contracts.

JPMorgan analysts agreed the agencies would move fast, but flagged a catch: agency rules are less durable than statute. Future administrations can rewrite them, and courts can strike them down.

Why the bill died

Democrats largely opposed the bill over ethics concerns — specifically the growth of President Trump's crypto interests — while Republicans rejected a Democratic counteroffer, even after incorporating 126 requested changes, per reporting. With November elections approaching and the legislative calendar thinning, one Republican Senate aide said the bill is dead, though Sen. Thom Tillis believes there's still a path.

Coinbase CEO Brian Armstrong summed up the industry's mood on Wednesday: "The CFTC and SEC are stepping up. Go time."

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