The Digital Asset Market Clarity Act has failed to advance in the Senate, as four Republicans and all Democrats in the chamber voted against the bill.

The Clarity Act sets out a regulatory framework for digital assets, including specifying which agencies have regulatory oversight of cryptocurrencies and setting out how commodity exchanges can be regulated like other financial institutions.

It has been repeatedly delayed since passing the House of Representatives in July 2025, with Senate Majority Leader John Thune having filed a cloture motion in August in an attempt to push it through. Among Democrats, ethics is a major sticking point.

Ahead of the vote, banks and the digital assets industry respectively engaged in heavy lobbying efforts. Traditional lenders argued that rewards for holding stablecoins could lead to deposit flight.

To allay these fears, the Republican senators behind the bill made last-minute changes to the final text on Monday, providing the Secretary of the Treasury with new powers to block stablecoin rewards if they determine the new regime is having a “substantial detrimental impact” on community banks.

The new text also added new ethics controls that would force public officials and their spouses to place “significant” digital assets in a blind trust or to divest them altogether.

Democrats remain unconvinced, with some critics arguing that, as the provisions would be overseen by the Department of Justice, their enforcement could be watered down along partisan lines.

On the eve of the vote, the Massachusetts senator Elizabeth Warren called the new ethics text, which President Trump approved, a “weak fig leaf that will do nothing to stop him from making his next $1.4 billion in crypto profits”.

Republican senators Susan Collins, Josh Hawley, Jerry Moran and Thom Tillis voted against the bill, having seconded concerns over ethics and financial stability.

Because this was a procedural cloture vote, a mechanism to progress a bill and force a final floor vote, the Clarity Act has not been struck down and can be reintroduced to the Senate.

Tillis first voted in favour of the bill and then against it. Because senators on the winning side of a vote can reconsider it at a later date, this leaves a route open to reintroduce the Clarity Act to the Senate. Tillis told press that his decision was intended to allow work on the Clarity Act to continue.

With midterm elections coming in November, however, it remains unclear if the Republican Party will retain the seats necessary to push the bill through.

Thirty-five Senate seats are up for election in November, consisting of 33 Class 2 seats and two special elections prompted by the resignations of JD Vance and Marco Rubio to serve in the Trump administration. If the Democrats prevail, the number of senators opposed to the Clarity Act at its next attempt could be larger.

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