US Senate Blocks CLARITY Act as Bitcoin Drops Below $76K

The US Senate dealt a significant blow to crypto regulatory clarity on Tuesday, failing to advance the CLARITY Act in a key procedural vote. The cloture motion fell well short of the 60 votes needed to move the legislation toward floor debate, putting the bill's prospects for passage this year in serious doubt. With limited legislative time remaining before a new Congress is sworn in, the failed vote represents a major setback for efforts to establish a comprehensive federal framework defining oversight of digital assets by the Securities and Exchange Commission and the Commodity Futures Trading Commission. Bitcoin dropped below $76,000 in immediate response to the outcome, reflecting market sensitivity to regulatory developments in Washington.

Adding to the regulatory uncertainty, Polymarket traders sharply cut their odds of the CLARITY Act becoming law this year, with probability falling to 16 percent. The decline followed reports that key Senate Democrats had not been swayed by Republicans' described "final" crypto bill proposal, despite the legislation advancing through months of negotiations over ethics restrictions and other provisions. The combination of bipartisan resistance and compressed legislative timelines has effectively sidelined comprehensive crypto market structure legislation for the current session.

Separately, the House Ways and Means Committee prepared to consider a 114-page crypto tax package that omits a key provision sought by industry advocates. The Digital Asset Tax Certainty Act, H.R. 10357, published Monday alongside the committee's markup notice, does not include the reward-timing provision from Representative Mike Carey's Tax Clarity for Mining and Staking Act introduced in June. Without that provision, miners and stakers remain subject to taxation on rewards when received or brought under their control—potentially before the tokens are sold for cash. The omission removes a significant piece of tax relief the crypto industry had lobbied to include, complicating the financial calculus for proof-of-work miners and proof-of-stake validators operating in the United States.