The U.S. Senate did not advance the CLARITY Act, but this decision, although negative for the crypto market in a broad sense, could end up being positive for Bitcoin. The proposal failed to secure the 60 votes needed to proceed and, given the U.S. election calendar, should remain stalled for a considerable amount of time. Thus ends a discussion that had been keeping investors trapped in rumors, political negotiations, and successive changes to the text.

The chances of approval already seemed small. On one side, the banking lobby resisted primarily the rules that could benefit stablecoin companies and expand competition with traditional deposits. On the other, Democrats would hardly back legislation that could favor Donald Trump, no matter how many concessions Republicans made, while the president and his family maintain strong financial interests in the crypto sector. In this political environment, the technical quality of the proposal became less important than the partisan dispute and the economic interests involved.

For the market, a negative definition may be less harmful than an endless state of uncertainty. With each new meeting, proposal, or voting possibility, expectations arose that were soon frustrated, fueling volatility and insecurity. Now, investors already know they should not count on the CLARITY Act in the short term. The outcome was bad for brokerage firms, stablecoin issuers, and various altcoins, but Bitcoin is less dependent on this legislation, as it already has much more consolidated regulatory recognition in the United States

This does not mean that Bitcoin necessarily has to rise immediately. The Federal Reserve’s interest-rate decision, the path of inflation, the war involving Iran, oil prices, and overall liquidity conditions remain far more important factors for the price. A more hawkish stance from the Fed or a new rise in oil could pressure all risk assets. However, specifically regarding the CLARITY Act, removing this uncertainty eliminates an additional source of anxiety and allows the market to focus again on economic fundamentals.

That’s why the bill’s defeat may represent one of those cases where an apparently bad news story produces a positive effect after the initial reaction passes. Bitcoin may move back up not because the CLARITY Act failed, but because the market will finally stop trading day by day on the possibility of its approval. Between a known negative decision and months of political gridlock, the first alternative is likely to be better for Bitcoin.