Leading crypto firms like Coinbase, Circle, and Galaxy experience significant losses following the Senate's failure to pass the much-anticipated market structure bill.
By Helene Braun|Edited by Cheyenne Ligon56 min ago2 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShow- Cryptocurrency stocks experienced a steep decline on Tuesday after the Senate did not pass the Clarity Act, with Coinbase, Circle, and Galaxy each seeing drops exceeding 8%.
- The Senate's 49-50 vote fell short of the 60 votes necessary, marking a significant setback for the crypto industry's efforts to establish a federal market structure.
- While broader U.S. stocks also faced declines ahead of the Federal Reserve's decision on interest rates, the sharper losses in crypto stocks were attributed to the fallout from the Clarity Act's failure.
On Tuesday afternoon, crypto stocks were largely in decline following the Senate's decision not to advance the Clarity Act, which has been a critical objective for an industry that has invested years and substantial financial resources in pursuit of a comprehensive regulatory framework in the U.S.
Coinbase COIN$172.05·Market Closed saw a nearly 9% drop, closing at $174.42, while Circle CRCL$85.49·Market Closed fell 9.4% to $88.26. Galaxy Digital GLXY$22.27·Market Closed experienced an 8% loss, and Gemini (GEMI) dropped by 7%.
The downturn affected the entire sector, with Robinhood HOOD$110.01·Market Closed decreasing by 3%, Bullish BLSH$35.20·Market Closed losing 5%, and eToro (ETOR) slipping 4%.
Among crypto mining companies, Riot Platforms RIOT$19.73·Market Closed fell 5%, while MARA Holdings MARA$11.24·Market Closed, CleanSpark CLSK$12.63·Market Closed, IREN, and Core Scientific CORZ$16.07·Market Closed saw declines ranging from approximately 3% to 4%.
The selloff followed the Senate's 49-50 procedural vote against advancing the Digital Asset Market Clarity Act, which required 60 votes to pass.
This proposed legislation aimed to define the regulatory treatment of various cryptocurrencies and blockchain projects while enhancing the authority of the Commodity Futures Trading Commission (CFTC) over crypto spot markets.
The bill's defeat prolongs the industry's wait for essential legislation that many companies claim is necessary for their strategic planning in the U.S.
However, the Senate vote was not solely responsible for the overall market downturn. Investor behavior was also influenced by risk reduction strategies ahead of Wednesday's anticipated Federal Reserve interest rate decision, which is likely to result in an increase.
Bitcoin BTC$75,921.92 has decreased about 3% in the last 24 hours, briefly dropping below $75,000. Major U.S. stock indices, including the Nasdaq and S&P 500, also faced losses.