Senate Rejects CLARITY Act, Crypto Oversight Shifts
Senate Rejects CLARITY Act, Crypto Oversight Shifts
Anonymous
Key Points
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The CLARITY Act had already passed the House by a 294-134 vote in July 2025 before stalling in the Senate.
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Coinbase’s opposition to the initial version was consequential: its withdrawal of support in January led the Senate Banking Committee to delay its planned review of the bill.
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Armstrong said Coinbase will continue paying stablecoin rewards because the GENIUS Act is already law, arguing that banks are now in a weaker competitive position and may later seek a revised “clarity version two.”
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Coinbase recently launched tokenized stocks and described them as securities redeemable one-for-one for the underlying shares; Armstrong said the company expects to bring the product to the U.S. through an anticipated SEC innovation exemption.
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Anthony Scaramucci said the bill’s collapse reflected partisan rancor and called the subsequent effort to assign blame to Armstrong a “blame game” and “total nonsense.”
The U.S. Senate blocked the CLARITY Act on September 15, falling 11 votes short of the 60 needed to advance cryptocurrency regulation. CoinDesk reported that Coinbase CEO Brian Armstrong rejected blame for the bill's collapse, saying political disputes and banking-sector opposition killed the legislation, not the company's concerns about decentralized finance and stablecoin rules.
The House had passed the bill 294-134 in July 2025. With federal legislation stalled, the SEC and CFTC may now issue their own rules — potentially more permissive in the short term. Armstrong said the defeat could temporarily benefit Coinbase by delaying competition from traditional banks, even as the company expands stablecoin rewards and tokenized stocks.
Coinbase's Shifting Position on Crypto Rules
Coinbase opposed an early draft of the CLARITY Act over concerns about how it split authority between the SEC and CFTC, as well as rules on decentralized finance and stablecoin rewards. Yellow reported that the company's January withdrawal of support forced the Senate Banking Committee to delay its review. Armstrong later backed a revised version but says political gridlock prevented passage.
Armstrong argued that Coinbase will keep paying stablecoin rewards because the GENIUS Act is already law. He also noted that banks now face weaker competitive footing and may push for a "clarity version two" down the road. CoinCodex covered Saylor's view that the bill's failure could benefit crypto by avoiding restrictions.
Scaramucci Defends Armstrong Amid Blame Game
SkyBridge Capital founder Anthony Scaramucci dismissed criticism of Armstrong as a "total nonsense" blame game. He called the bill's collapse a partisan failure rooted in political rancor, not the crypto industry. CryptoBriefing reported that Michael Saylor, the executive chairman of Strategy Inc., called the rejection a "positive inflection point" for crypto.
New SEC, CFTC Rules May Fill the Void
Without federal legislation, the SEC and CFTC are advancing their own crypto rules. Kitco noted that Frank Holmes, CEO of U.S. Global Investors, highlighted how agency rulemaking could step in. Armstrong suggested these rules may be more permissive than the failed CLARITY Act, at least temporarily.
Coinbase is moving ahead with tokenized stocks, which the company describes as securities redeemable one-for-one for underlying shares. Armstrong said Coinbase expects to bring the product to the U.S. through an anticipated SEC innovation exemption. The fragmented regulatory landscape ahead will likely force the industry to navigate multiple agency regimes.
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