Senate Fails to Advance CLARITY Act as SEC Proposes Crypto Rules

The Senate’s stalled CLARITY Act has left the U.S. without a broad crypto market law even as a separate stablecoin statute nears effect and regulators advance narrower measures.

The House passed the Digital Asset Market Clarity Act of 2025, known as the CLARITY Act, by 294-134 on July 17, 2025. On Sept. 15, 2026, the Senate failed to invoke cloture on a motion to proceed to the bill, with 49 votes in favor and 50 against. That procedural vote was not a final vote on the legislation.

Congress enacted the GENIUS Act on July 18, 2025. Under the law, permitted issuers must back each outstanding payment stablecoin with at least $1 in eligible reserves and disclose their reserve composition monthly.

Other federal actions have already taken effect. Congress disapproved an Internal Revenue Service (IRS) broker-reporting rule covering certain decentralized finance activity, and the IRS removed it from its regulations in July 2025. SEC staff rescinded earlier staff accounting guidance for crypto held for platform users in January 2025.

On Oct. 5, the Financial Crimes Enforcement Network (FinCEN) withdrew two proposed rules. One concerned recordkeeping, verification and reporting for certain transactions involving unhosted wallets; the other concerned crypto mixing. Neither proposal had become a final rule.

In March, the SEC issued an interpretation, joined by the CFTC, addressing how federal securities laws apply to categories of crypto assets and transactions. The SEC later proposed two offering exemptions: a one-time exemption capped at $5 million over four years and another capped at $75 million per 12-month period. It also proposed custody-rule changes for investment companies and advisers handling crypto securities and similar investments. Those measures remain proposals.

The SEC granted temporary, conditional relief in September for certain permissioned venues trading tokenized U.S. stocks. The relief includes limits on trading and requirements concerning holders’ rights. SEC Chairman Paul S. Atkins said Sept. 17 that “this interim measure must be followed by durable rulemaking.”

The CFTC took a separate step on Oct. 5, seeking comment on a possible framework for certain retail crypto transactions. Its notice could inform future rules but does not establish a completed framework. The next scheduled milestone is Jan. 18, 2027, when the GENIUS Act’s payment-stablecoin issuer regime is set to take effect.