The Digital Asset Market Clarity Act failed to survive the politics of the U.S. Senate on Tuesday as a vote meant to start the bill toward passage fell far short in rounding up the 60 supporters required to advance.
The industry has spent years and hundreds of millions of dollars trying to bring Congress to an approval of the market structure legislation, and while the Senate's vote represents the furthest such an effort has progressed so far, the loss comes as a blow to the army of lobbyists, advocacy groups, political action committees and high-profile crypto executives that sought a new law.
The setback for the crypto industry's top policy goal potentially sends the process back to the drawing board unless some long-odds maneuvers develop in the final weeks of the congressional session after November's midterm elections.
Negotiators for the two political parties had hashed out more than 600 pages of legislative compromise, but a few final sections of the bill — such as the ethics provisions meant to curtail senior government officials from maintaining crypto business ties — turned out to feature insurmountable rifts. And the closer the process dragged toward the elections, the more likely it was that political pressures would get in the way of a bipartisan deal.
Leading Republican negotiator Senator Cynthia Lummis made the final pitch before the vote, but she failed to convince enough colleagues to join her.
“Do not let this day be the day we handed our future to someone else because we were too afraid to finish what we started,” she said on the Senate floor. “Let's vote yes. Let's not only join the 21st Century economy. Let's not only join the digital age. Let's lead it. Let's define it.”
So what now?
The industry will turn to the U.S. markets regulators who are already at work trying to impose rules on the sector. The Securities and Exchange Commission and the Commodity Futures Trading Commission have started moving forward on initiatives the industry hopes will provide enough regulatory stability and certainty that it will help coax more investors and business off the sidelines.