- Bitwise views the Senate setback as temporary rather than decisive.
- Bitcoin rallied while passage odds fell, weakening a direct price link.
- Agency rules can advance, but Congress offers stronger legal certainty.
The CLARITY Act setback may not trigger the prolonged crypto downturn Bitwise CIO Matt Hougan once expected. Bitcoin fell about 4% after the Senate vote on Tuesday, while crypto liquidations intensified. Still, Hougan called the failure a “speed bump, not a roadblock.” He cited Bitcoin gains since July and continued Wall Street expansion into digital assets.
Bitcoin Rally Weakens the CLARITY Act Failure Argument
Bitcoin bottomed near $57,950 on July 1 before moving above $80,000 by September 4. During that span, Polymarket odds for passage fell from 39% to 18%. Hougan said the opposing moves weakened claims that the CLARITY Act was essential for the rally.
The official Senate vote ended 49-50 against cloture. The bill finished 11 votes short of the required 60. The vote blocked debate but did not finally defeat the market structure bill.
Four Republicans opposed cloture. Senator Thom Tillis changed his vote after the result became clear, preserving a path for reconsideration.
Robinhood launched its Ethereum-compatible chain. Morgan Stanley introduced Solana and Ether exchange-traded products. DTCC also processed tokenized securities transactions involving roughly 40 firms. These launches continued before lawmakers resolved federal crypto regulation.
SEC and CFTC Rules Offer a Shorter Regulatory Path
Hougan said supportive SEC and CFTC leadership gives financial firms confidence through 2029. Both agencies signaled continued rulemaking after the CLARITY Act stalled.
The SEC proposed Regulation Crypto Assets on August 18. It includes tailored exemptions and a conditional safe harbor. Public comments remain open through October 20.
The CFTC can act within existing authority. However, only Congress can expand its control over spot crypto markets. Agency rules can face lawsuits or reversal under future administrations. The CLARITY Act would still provide stronger and more durable certainty.
Macro pressure remains a separate risk. The Federal Reserve raised rates to 3.75%-4.00% on September 16, its first increase since 2023. Bitcoin later traded near $76,274, while about $571 million in crypto longs were liquidated. The bill remains unresolved, while neither agency has finalized a comprehensive replacement framework.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.
