US Senate Rejects Crypto CLARITY Act, Triggering Bitcoin Dip and Major Crypto Stock Sell‑off

The U.S. Senate failed to advance the CLARITY Act on Tuesday, rejecting cloture on the motion to proceed and falling short of the 60 votes that step requires. Wire reports of the tally differ on order, one carrying 50-49 against and another 49-50, but both agree the motion did not reach the 60 vote threshold. The bill would have established rules for crypto markets and clarified the respective responsibilities of the Securities and Exchange Commission and the Commodity Futures Trading Commission, so the failure leaves that jurisdictional question unresolved.

The market reaction was immediate. Bitcoin traded down to $76,013 after the vote with a low of $74,900, while Ether slipped to $2,405 against a widely watched $2,400 support level. Roughly $275 million of long positions were liquidated within 20 minutes and about $70 billion of crypto market capitalization was erased. Crypto equities extended the selloff, with COIN and CRCL each sliding around 10%. Bitcoin had already been weakening ahead of the result, trading below $77,000 on Tuesday morning and down about 1.2% over 24 hours as the odds of passage collapsed.

That pre-positioning is the part worth noting. ARK Invest sold across nearly every crypto-linked holding on Monday, the day before the vote. The firm trimmed more than one million shares of its own ARK 21Shares Bitcoin ETF through the ARK Next Generation Internet ETF and another 466,133 shares through the ARK Fintech Innovation ETF, together more than 1.5% of the respective fund positions. Inside the ARK Innovation ETF it cut Bullish, BMNR, COIN and CRCL, with Circle the largest dollar-weighted crypto sale at 113,369 shares. Investor's Business Daily put the total at $60 million of crypto stock sold ahead of the vote.

The setback is procedural rather than final. One market read circulating after the vote stresses that this is "NOT the final death of the bill" and puts the earliest realistic window for another attempt at Thursday, if lawmakers can reach a new agreement. The same read argues the outcome was increasingly priced in, since Bitcoin had been selling off as passage odds fell, and flags roughly $75.5K as the level that would define a bearish structure from here.

Two things determine the next move. The first is whether a revived vote materializes later in the week and on what terms. The second is Wednesday's Federal Reserve decision, where a 25 basis point hike is now anticipated at 93%, which puts a second macro catalyst in front of a sector that has just repriced on a regulatory one.