Senate fails to advance Clarity Act amid Democratic concerns about crypto bill

Washington — The Senate on Tuesday failed to advance a sweeping cryptocurrency bill known as the Clarity Act, amid opposition from Democrats and a handful of Republicans.

In a 49 to 50 vote, the measure fell short of the 60 votes needed to move forward, with all Democrats and four Republicans opposing.

The bill would establish a regulatory framework for digital assets. Ahead of the vote on Tuesday, Senate Majority Leader John Thune argued passing it would be the "next logical step" after Congress approved legislation last year to regulate a type of digital currency known as stablecoins. Thune said that landmark bill, known as the Genius Act, provided a "light-touch approach" to digital asset regulation, and credited it for the industry "moving in the right direction" in the United States.

Thune, a South Dakota Republican, noted that the Clarity Act distinguishes between the jurisdictions of the Commodity Futures Trading Commission and the Securities and Exchange Commission, two financial regulators that have split crypto enforcement in sometimes confusing ways, while ensuring that they work together to "harmonize the rules." He also touted that the bill "ensures that companies can't skirt securities laws that apply to other financial assets." And he argued that it "protects the growing number of Americans investing in and utilizing digital assets."