The CLARITY Act failure triggered a broad cryptocurrency selloff Wednesday after a Senate cloture vote fell short 49-50, blocking advancement of the Digital Asset Market Clarity Act.

At the time of publication, Bitcoin was trading at $75,760, XRP dropped nearly 10%, and Ethereum (ETH) slid close to 5% within hours of the vote.

The bill would have assigned clear jurisdictional lines between the SEC and the CFTC over digital assets, and its failure removed a catalyst traders had been pricing in for weeks.

The CLARITY Act was designed to settle a long-running turf dispute between the Securities and Exchange Commission and the Commodity Futures Trading Commission, the two federal regulators that currently split oversight of crypto markets without clear statutory boundaries.

Under existing law, whether a token counts as a security or a commodity often depends on case-by-case SEC enforcement rather than a fixed rule, which has left exchanges and issuers guessing at which regulator’s rules apply to any given asset.

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A cloture vote is a Senate procedural step requiring 60 votes to end debate and proceed to a final vote.

Falling to 49-50 means the bill cannot advance without another attempt.

A Bill Traders Had Priced In For Months

Crypto markets had rallied on expectations that market structure legislation would finally pass this session, following momentum from House committee votes earlier in the year. Bitcoin’s slide reflects the market unwinding that regulatory-clarity premium rather than a fresh shock, since the underlying jurisdictional dispute between the SEC and CFTC now returns to square one with no fixed timeline for reintroduction.

XRP’s outsized drop reflects its history as one of the most litigated tokens in prior SEC enforcement actions, making it the most exposed to any lapse in a clear commodity classification.

Bitcoin’s move below the $77,000 level snapped a run of stability, and traders will watch for signs the bill gets reintroduced with amended vote-counting before year end.

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