The crypto industry is recalibrating its regulatory strategy after the CLARITY Act failed a Senate procedural vote on September 15. Coinbase CEO Brian Armstrong has urged the SEC and CFTC to create clear rules using existing authority, calling the bill’s failure a “disappointment” but noting some compromises were “tough to swallow.” The White House Chief Crypto Advisor labeled the outcome a “failure of American leadership.” Attention now shifts to November’s midterm elections, as several moderate Senate Democrats who negotiated the bill ultimately voted against it. Crypto-backed PACs and lobby groups have warned of voter backlash, though some analysts question the issue’s electoral priority.
The crypto industry is exploring new paths to advance its regulatory agenda after the CLARITY Act failed a Senate procedural vote on Tuesday, September 15. The bill stalled after a 49-50 vote.
In a post on X following the bill’s failure, Coinbase CEO Brian Armstrong urged the SEC and CFTC to intervene. “We can’t wait on Congress anymore,” he stated, adding that the regulators “have the tools they need to create clear rules under existing authority.”
Armstrong called the vote a “disappointment” but suggested the failure could be “for the best.” He noted that some stablecoin yield compromises in the bill were “tough to swallow.”
White House Chief Crypto Advisor Patrick Witt also criticized the outcome, calling it a “failure of American leadership.” He warned that global financial markets’ standards will now look to Europe and China.
Attention has now shifted to the November midterm elections. Several Senate Democrats perceived as moderate voted against the bill, including Kirsten Gillibrand (D-NY), Mark Warner (D-VA), Cory Booker (D-NJ), Raphael Warnock (D-GA), Reuben Gallego (D-AZ), Angela Alsobrooks (D-MD), and Catherine Cortez (D-NV).
These moderate Democrats had spent months negotiating the bill and were expected to be crucial swing votes. Some, such as Gallego and Alsobrooks, received considerable crypto support in past elections.
Reports indicated that crypto’s super PAC, Fairshake, was planning to not spend on Democrats who supported the bill. Stand With Crypto, a Coinbase-backed lobby group, has warned anti-crypto lawmakers. “This November, crypto voters will show up and demonstrate their power at the ballot box,” the group stated.
Bloomberg Analyst Eric Balchunas noted that 15 of the 50 Senators who voted against the bill are up for election. However, Galaxy founder Mike Novogratz offered a different perspective. “I honestly don’t believe crypto and this bill will be a top 10 issue in this election,” he wrote, stating the 2026 election will be about war, inflation, affordability, AI, and immigration. It remains unclear if the industry can win support in the next Congress.
