Crypto Industry Responds to Clarity Act Setback in U.S. Senate

The crypto industry is turning its attention to regulators and future lawmakers after the Digital Asset Market Clarity Act failed to clear the Senate’s 60-vote threshold.

Tuesday’s procedural vote ended the latest attempt to move comprehensive U.S. crypto market structure legislation forward. While executives described the result as disappointing, several said regulatory work already underway at the Securities and Exchange Commission and Commodity Futures Trading Commission can continue independently of the bill.

The main concern raised by industry participants was not whether regulation will continue, but how durable agency-driven rules will be. Unlike legislation, agency rules can be revised by a future administration without requiring Congress to pass a new law.

Some executives also compared the U.S. situation with Europe’s Markets in Crypto-Assets Regulation, or MiCA, which has provided a common regulatory framework since December 2024.

Garlinghouse: The Vote Was a Setback

Ripple CEO Brad Garlinghouse said the result was difficult for an industry that had invested heavily in getting the legislation across the line.

He said Ripple and other participants had worked toward rules that could provide greater certainty for consumers and companies while supporting U.S. competitiveness.

Garlinghouse called for a review of what led to the failed vote and criticized Democratic lawmakers who opposed the legislation.

He nevertheless said the regulatory process can continue through the SEC and CFTC. Garlinghouse pointed to SEC Chair Paul Atkins and CFTC Chair Brian Selig as officials who can pursue rulemaking while Congress remains divided.

Ripple’s own business, he said, continues to benefit from demand across traditional finance and digital assets. He added that the Senate vote does not alter the company’s global operations or customer activity.

Howe: Agency Rules Lack Legislative Permanence

Connor Howe, co-founder and CEO of Enso, said the failed vote does not eliminate the regulatory initiatives already being developed.

Howe highlighted Selig’s instruction for CFTC staff to work on a market structure regime using existing Commodity Exchange Act authority. He also cited the SEC’s Regulation Crypto Assets proposal, which was released for public comment in August.

But Howe said the absence of legislation leaves questions about the longevity of those rules. A future agency leadership team could rewrite an existing rule, while statutory requirements would require Congress to act.

He also pointed to the proposed Section 1960 provision concerning developers who do not control customer funds. Howe said putting that protection into law would make it more difficult to reverse.

Blume Warns of a Prolonged Policy Gap

Alex Blume, founder and CEO of Two Prime, said the Senate vote effectively ends the immediate prospect of definitive federal crypto legislation.

Blume argued that continued uncertainty could encourage businesses to consider jurisdictions outside the United States. He referenced FTX when discussing the potential risks associated with offshore structures and said clear domestic rules could help legitimate crypto businesses operate in the U.S.

He also argued that the industry’s diversity makes broad regulatory treatment difficult, noting the difference between speculative tokens and large stablecoin systems.

Blume expects the SEC and CFTC to address some outstanding issues through rulemaking, including the division of responsibilities and stablecoin treatment. He noted, however, that agency policies can change under a new administration.

Biswal: Markets Had Already Expected the Risk

Barnali Biswal, CEO of Hilbert Group, said the failed vote should not necessarily result in a sharp crypto-market reaction because prediction markets had already reflected the possibility that the bill would not advance.

For Biswal, the more important consequence was the loss of momentum around the legislation.

She also cited lobbying by major banking trade organizations over stablecoin yield provisions. Without an agreement, she said institutional investors continue to face a fragmented regulatory landscape.

Strategy Points to Bitcoin’s Existing Framework

Michael Saylor’s Strategy emphasized that Bitcoin already has several established forms of regulatory and tax treatment in the United States.

The company pointed to the CFTC’s treatment of bitcoin as a commodity, the IRS classification of bitcoin as property, SEC approval of spot bitcoin products and FASB accounting treatment for bitcoin as a GAAP asset.

Konevsky: Institutional Adoption Continues

tZERO CEO Alan Konevsky said the Senate vote does not reverse the broader development of regulated digital-asset markets.

He pointed to proposed SEC and CFTC rules and ongoing coordination between the agencies as evidence that regulatory development remains active.

Konevsky said institutions can continue adopting digital-asset technology as regulated infrastructure becomes more established.

Gregaard Highlights Europe’s MiCA Rules

Frederik Gregaard, CEO of the Cardano Foundation, contrasted the U.S. situation with Europe’s regulatory framework.

He said builders in Europe have been able to work under MiCA since December 2024, giving them a defined set of rules for digital assets.

Gregaard said blockchain development is continuing because of its practical uses and emphasized the importance of regulatory clarity for companies operating in the sector.

Chainlink Says Clarity Is Still Needed

Katherine Kirkpatrick Bos, head of legal at Chainlink Labs, said the Senate outcome reinforced the need for clear rules.

She said regulatory certainty remains important for consumers, institutional adoption and the United States’ role in financial markets.

Kirkpatrick Bos said Chainlink Labs will continue working with lawmakers on digital-asset legislation.

NEAR Looks Toward the Next Congress

Abhishek Vaidyanathan, chief legal officer at NEAR, said the next Congress could offer another opportunity to pursue market structure legislation.

He noted that the House canceled its weeks beginning Sept. 21 and Sept. 28, while the Senate’s state work period begins Oct. 5, ahead of the Nov. 3 election.

Vaidyanathan said the absence of statutory rules leaves companies more reliant on agency guidance and administrative decisions. He argued that this could create additional uncertainty for legal planning and 2027 budgets.

He also cited Europe’s MiCA framework and said the U.S. lacks comparable statutory support for broader digital assets, while GENIUS provided a legislative foundation for stablecoins.

Matter Labs: Banks Are Still Building

Vassilis Tziokas, VP of growth at Matter Labs, said the Senate vote changes the timing of legislation but not the development of blockchain-based banking projects.

He pointed to banks building tokenized deposit networks that can move dollars onchain while keeping deposits on bank balance sheets under existing rules.

According to Tziokas, these networks can also support intraday repo, weekend collateral and tokenized securities, with privacy becoming an important design requirement.

He cited JPMorgan’s deposit token, Citi’s tokenized payment activity and blockchain initiatives involving regional and community banks. He also noted that Cari had raised more than $30 million with backing from banks.

Tziokas said the legislative delay could place greater emphasis on SEC and CFTC rulemaking as well as guidance from banking regulators.

GSR Sees Regulators Taking a Larger Role

Joshua Riezman, chief legal and strategy officer at GSR, said the Senate’s inability to advance comprehensive legislation will increase attention on federal regulators.

He said the industry will continue looking to the SEC, CFTC and other agencies for rules capable of addressing the market structure questions left unresolved by Congress.

Riezman also noted that other jurisdictions may move more quickly with their digital-asset frameworks.

The industry responses show that the Senate vote has not ended U.S. crypto policy development. Instead, attention is shifting toward agency rulemaking, the next Congress and the question of whether regulatory measures adopted without legislation can provide businesses with lasting certainty.