The US Senate rejected the Digital Asset Market Clarity Act, which would have established federal oversight of cryptocurrencies. The bill received 49 votes in favour and 50 against, short of the 60 needed to pass. Four Republicans broke ranks. With midterm elections in November, bringing the measure back is nearly impossible.
The main cause of failure was ethics. The revised text, published a day before the vote, failed to satisfy senators over weak requirements for senior officials tied to crypto businesses. Arizona senator Ruben Gallego said Republicans 'refused to say no to the president' instead of negotiating stricter ethical standards with Democrats. Republicans accused their opponents of sabotage.
For the gambling industry, the bill's defeat is a win. In June a coalition of gaming associations — the American Gaming Association, Indian Gaming Association, UNITE HERE and others — sent a letter to the Senate demanding the legislation ban sports betting and casino play on crypto exchanges. Crypto is the second-largest category on prediction-market platforms after sports, and several exchanges including Crypto.com, Coinbase and Gemini already offer wagering. Indian Gaming Association chairman David Bean called the Senate decision 'the right one' but warned that 'this is not the end of the fight'.
The defeat is a blow to the CFTC and its chair Michael Selig, who pushed hard for federal crypto regulation. The Clarity Act would have expanded the commission's authority, but now any rules issued by the CFTC or SEC are vulnerable to legal challenge.
For the legal market, the absence of crypto regulation is a setback. Paysafe data shows 64% of online bettors use cryptocurrency — double the US average of 30%. Crypto deposits are allowed only in Wyoming and Colorado; withdrawals are permitted nowhere. 85% of respondents want crypto withdrawal options. Without a legal route, players turn to offshore platforms.
