Core event: a regulatory pivot within 24 hours
In the early hours of September 17, less than 24 hours after the CLARITY Act failed to pass a Senate vote, SEC Chair Paul Atkins said, “The SEC will take action to provide certainty for cryptocurrencies.” At the same time, CFTC Chair announced that, using existing authorities, it would move forward with rulemaking for crypto assets. The two regulators made it clear they would “not wait for Congress,” directly filling the legislative gap with administrative rules. The Treasury Secretary, Betsent, then confirmed the alternative plan: if legislation fails, the SEC and CFTC’s rulemaking process will be the closest thing to a regulatory roadmap for the remainder of 2026 for the U.S. crypto market.
Why CLARITY Failed
The bill aims to divide SEC/CFTC jurisdiction and establish a registration and disclosure regime for trading platforms, broker-dealers, and traders. It was introduced in May 2025 by the Chair of the House Financial Services Committee, Hill. The House passed it 294:134, and in May 2026 it was advanced to the full floor vote by a 15:9 tally from the Senate Banking Committee; but on September 15, a procedural vote passed with only 49 in favor and 50 against, failing to reach the 60-vote threshold.
There are three reasons for the failure:
Partisan opposition: Voting largely follows party lines.
Conflict-of-interest clause: Democrats demanded limits on the Trump family’s crypto interests, but the bill did not cover their children (Trump profited about $1.4 billion from the crypto business in 2025).
Stablecoin rewards and states’ power: The banking industry worries about community banks losing deposits; state attorneys general jointly opposed the Treasury Secretary’s “break-the-fuse” power, weakening states’ enforcement authority.
The time window closes as well: after the Senate reconvenes on September 14 until the midterm election, there are only about 16 effective legislative days left, and it adjourns on October 5. If it isn’t advanced in September, the bill can only be carried into the 2027 new Congress, or attempt to be marginalized in the “lame-duck” session after the November election.
Three Shifts in Market Structure
Switch in pricing logic: Moving from “waiting for regulatory catalysts” to “assessing the real impact of administrative rules,” product design and institutional allocation will be reworked based on SEC funding exemptions and CFTC spot licensing.
Spot vs. derivatives divergence: The CFTC pushes for legal spot trading of digital commodities, but derivatives remain tightly constrained by leverage and other strict rules, which may prompt institutions to move derivatives operations overseas.
A boom in stablecoin gray areas: Revenue-limitation provisions become ineffective as the bill fails—looser in the short term but under pressure long term. EXIO Research Institute projects that within the next 24 months, $30–50 billion in stablecoin assets will flow from the United States to places like Hong Kong.
Global landscape: Accelerating multipolarity
United States: Administrative rules fill short-term gaps, but they are fragmented and lack long-term stability.
Hong Kong: Became the Asia-Pacific compliance hub supported by stablecoin licensing, RWA tokenization, and retail BTC/ETH spot (with a 7-day cooling-off period and risk disclosure).
European Union: MiCA’s full implementation triggers a shake-up—around 80% of European crypto firms may exit or be acquired.
China: Trading remains strictly banned domestically, but cross-border penetration regulation is being advanced via CRS 2.0 and CARF.
Conclusion
CLARITY’s failure did not end the regulatory process; it only moved certainty from Congress to regulators. The key trade-off in the post-CLARITY era is between the “speed of certainty” and the “lifespan of certainty.” Companies should enjoy the short-term convenience of administrative rules while keeping hedging plans ready in case policy swings back; meanwhile, global crypto market control is accelerating toward regions where regulatory frameworks are more stable and enforcement more predictable.
