CLARITY Act failure shifts US crypto rules to agencies: experts

The failed Senate vote on the CLARITY Act has shifted attention toward the SEC and CFTC, while crypto founders and investors prepare for a longer period without a federal market structure law, industry experts told crypto.news.

The U.S. Senate failed to invoke cloture on the motion to proceed with the Digital Asset Market Clarity Act on Sep. 15. The procedural vote recorded 49 votes in favor and 50 against, leaving the measure 11 votes short of the 60 required to open debate.

The result did not formally kill the bill, but it removed its immediate route through the Senate. The legislation sought to divide oversight of digital assets between the Securities and Exchange Commission and Commodity Futures Trading Commission while creating registration paths for crypto trading platforms and other intermediaries.

CLARITY Act setback turns attention to US agencies

Sid Powell, CEO and co-founder of Maple Finance, said the regulatory focus would now move from lawmakers to federal agencies. He expects the SEC and CFTC to use existing law, rulemaking and guidance to define the industry’s operating boundaries over the next year.

“The SEC and CFTC can do a great deal within existing law, through rulemaking and guidance, and that is where the perimeter actually gets drawn over the next year.”

Powell said market structure legislation was always more difficult to pass than to introduce. He expects meaningful near-term direction to come from regulators, with comprehensive legislation more likely to return in the next Congress.

Gabor Gurbacs, founder and CEO of OpenAssets, reached a similar conclusion, saying the vote did not resolve questions about regulatory authority, asset classifications or the framework institutions can use.

“The vote may have stalled. Regulatory work has not.”

Gurbacs, however, favors industry-led standards over broad top-down requirements. He argued that large regulatory bodies rely on committees, precedent and risk avoidance, which can produce rules that move more slowly than the technology.

Courtney Olujobi, principal at Moon Pursuit Capital, also expects regulators to deliver most of the immediate progress. She distinguished between agency action, which can change under later administrations, and legislation that gives founders and investors greater long-term confidence.

“What this vote means is that, for now, most of the progress will come from regulators rather than Congress.”

Edwin Mata, co-founder and CEO of Brickken, agreed that government action does not end when Congress stalls. He said agencies can use their current authority to issue rules and guidance, although the quality of those rules matters more than the mere existence of a framework.

“The SEC, CFTC and other regulators still have to do their jobs, and we are already seeing them use their existing powers to provide their own rules and guidance.”

Former CFTC Chairman J. Christopher Giancarlo made a similar argument after the vote, saying the two agencies could continue developing digital asset frameworks under existing law, crypto.news reported.

Founders may build globally instead of waiting for Congress

The experts broadly rejected the idea that the vote would stop crypto development. Several said it could instead affect where companies hire employees, seek licenses, raise capital and launch products.

Kyle Sonlin, president and co-founder of Global Settlement Network, said founders serving institutions need to know how regulators will treat assets and which agency will supervise their businesses. He expects companies to retain an interest in the United States while considering clearer jurisdictions from the beginning.

“I do think more companies will build with a global footprint from the start and keep jurisdictions with clearer rules firmly in the mix.”

Varun Datta, founder and CEO of Truth Ventures, also said serious founders would continue operating in the United States. However, he expects regulatory predictability to take on greater weight when companies compare the country with competing markets.

“Founders deciding where to incorporate, hire, raise money will increasingly compare the US not just on access to capital, but on regulatory predictability.”

Olujobi described uncertainty as a cost that appears before a company faces a formal legal bill. It can influence whether an early hire is an engineer or compliance specialist, whether a product launches in the United States, and whether founders first approach American or overseas investors.

Mata pointed to the European Union’s Markets in Crypto-Assets framework as an example of both the benefits and costs of clear regulation. MiCA gave companies a defined entry point, he said, but also introduced compliance costs and rules that he considers excessive.

Bobby Gray, founder of TEXITcoin, offered a stronger version of the builders-will-continue argument. He said founders should create businesses that can withstand changes in the political and regulatory environment instead of relying on Congress to deliver certainty.

“Policymakers will eventually have to decide how America participates in this industry, but builders have already decided to keep building.”

The United States still offers deep capital markets, institutional buyers and an expanding base of regulated custody and investment products, according to Olujobi. Mata warned, however, that overseas decisions can become permanent once companies establish teams, banking relationships, licenses and customers in other jurisdictions.

Institutional adoption could become slower and more selective

The lack of legislation may have a larger effect on institutions that require stable compliance standards before committing capital or building products.

Raj Kamal, CEO and founder of TransFi, expects the setback to slow institutional adoption in the United States and other markets that take cues from American regulation. He also sees a risk that more activity will move to jurisdictions such as the United Arab Emirates and Singapore.

“In terms of the impact on the sector, this is going to delay institutional adoption and slow down the pace of stablecoin usage across payments and other parts of the financial sector, as well as the growth of tokenised deposits.”

Kamal expressed concern that the delay could bring back regulation through enforcement. Sonlin made a related point, saying financial infrastructure needs rules that can remain in place beyond one administration.

Jeff Ko, chief analyst at ViaBTC, drew a distinction between institutions that already hold Bitcoin through regulated exchange-traded funds and the next group considering broader crypto services. He expects banks exploring custody and trading, asset managers developing multi-token products and companies studying tokenization to move more slowly rather than leave the market entirely.

“The impact falls on the next wave of adoption, like banks building custody and trading desks, asset managers launching multi-token products, and corporates exploring tokenisation in the US.”

HashKey Group senior researcher Tim Sun also expects institutions to divide their capital according to regulatory risk rather than abandon crypto altogether. Assets and products that already fit established rules could continue attracting demand, while sectors that depend on new legislation may face more caution.

“This does not imply a total institutional retreat, but rather a sharp bifurcation in capital allocation strategies based on risk stratification.”

Sun said Bitcoin benefits from its relatively settled non-security status. Tokenized securities and real-world assets could also face less disruption because they can operate within existing securities and fund rules. DeFi developer liability and exchange token-listing standards remain more dependent on future policy decisions, he added.

Bitcoin remains more insulated than altcoins and DeFi

Bitfinex head of derivatives Jag Kooner said the muted initial response showed that traders had not positioned heavily for the bill to pass. With limited bets on approval, the failed vote produced fewer positions that needed to be closed.

“With few market participants betting on the bill’s approval, there were correspondingly few positions to unwind after it failed, which helps explain the market’s modest reaction.”

Kooner said the more important effect was the extension of regulatory uncertainty rather than a sudden repricing. His assessment matches Powell’s view that the failed vote was the more likely outcome throughout the legislative process.

Ko similarly said the bill had stalled without becoming legally dead. He argued that Bitcoin already has access to regulated ETFs and that the GENIUS Act has established a framework for payment stablecoins, leaving the largest regulatory gap elsewhere in the market.

“The real impact falls on the rest of the market.”

Ko expects altcoins, token issuers, DeFi protocols and U.S. exchanges to carry the largest regulatory discount because the divide between securities and commodities remains unresolved. He said that could keep Bitcoin dominance elevated and widen performance differences among tokens, favoring assets with clearer legal status and cash-generating businesses.

Sun offered a similar view, noting that crypto-linked companies could react more sharply than Bitcoin because their business models depend more directly on regulatory boundaries. Ko and Sun therefore both expect the delay to produce a more selective market rather than an equal effect across digital assets.

Rates and liquidity may matter more than the Senate vote

The regulatory setback is only one of several forces shaping the market. Ko said sticky inflation, oil prices above $95 and increased expectations of further interest-rate increases remained the larger headwinds.

“Crypto has rarely sustained a bull run while yields are rising and liquidity is tightening.”

Ko said a bull-market return this year was possible but not his base case. Such a recovery would likely require sustained ETF inflows, softer inflation readings and improved liquidity, with capital concentrating in fewer assets than in previous cycles.

Sun similarly said rising risk-free rates and the loss of regulatory optimism both pressured crypto following the vote. He expects Federal Reserve policy, long-term Treasury yields and U.S. dollar liquidity to determine Bitcoin’s next sustained move more than the timetable for legislation.

Despite differences over the severity of the delay, the experts largely agreed that development and investment would continue. The failed vote changes who shapes U.S. crypto rules in the near term, while making regulatory strength, jurisdiction and access to liquidity more important in decisions about what to build and where to allocate capital.