Crypto prices tumble as Senate blocks Clarity Act amid concerns over Trump family's crypto ties

The cryptocurrency market experienced a significant downturn in the past 24 hours, as the US Senate failed to pass the Digital Asset Market Clarity Act. This setback hit companies seeking clearer regulations for digital assets hard. XRP, Ether, Solana, and Bitcoin all suffered price drops in response. The bill's failure to gain the necessary 60 votes for passage marked a major disappointment after years of efforts and millions spent on its creation.

The Clarity Act aimed to establish regulations for various cryptocurrencies and blockchain projects, dividing responsibilities between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The CFTC would gain new authority over crypto spot markets, where digital assets are directly bought and sold.

However, disagreements over ethics provisions limiting senior government officials' crypto business interests thwarted the legislation. Democrats pushed for stronger safeguards for President Donald Trump and his family's crypto activities, while some Democrats still wanted tougher limits on the president's potential profits in office.

Trump reported over $1.4 billion in income from his family's crypto ventures and investments in 2025, with companies managing his interests holding substantial amounts of Bitcoin, Ether, and other tokens. Despite revised legislation proposed by Republicans, it failed to gain enough support to overcome the Democrats' and banking industry's objections.

With the midterm elections approaching, the bill's chances of being passed this year are diminishing. As trading began in Asia on Wednesday, XRP fell nearly 10% to $1.30, Ether dropped almost 5% to around $2,410, Solana declined 5% to just above $97, Dogecoin lost nearly 5%, and Bitcoin slipped almost 3% to below $76,000. The SEC and CFTC will now focus on developing regulations using their existing powers, but these rules remain susceptible to legal challenges and shifts in political leadership.