The U.S. Senate failed to push forward the CLARITY Act, which addresses the structure of the digital asset market, but Grayscale forecast that efforts to refine U.S. cryptocurrency policy will not stop.

On Sept. 16 local time, blockchain outlet The Crypto Basic reported that the Senate on Sept. 15 failed to send the bill to the next stage in a procedural vote.

In the vote, the bill failed to secure the 60 votes needed to overcome a filibuster. It drew 49 votes in favour and 50 against, and 4 Republican lawmakers also voted against it alongside Democrats. It effectively put the brakes on broad legislative talks the crypto industry had been hoping for.

Grayscale acknowledged the vote fell short of expectations but stressed that work to refine rules at the regulator level is continuing. It said, "The industry continues to make remarkable progress through the ongoing work of regulators like the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC)."

It also reaffirmed its position that it will continue cooperation with policymakers and regulators to create clearer and more comprehensive rules for digital assets. It said it expects U.S. cryptocurrency policy to keep maturing even if legislation is delayed.

The SEC and CFTC have taken steps this year to flesh out a regulatory framework for digital assets. In March, the two agencies released a joint interpretation on how federal securities laws apply to certain crypto assets and transactions. The interpretation divided categories into digital commodities, digital collectibles, digital tools, stablecoins and digital securities, and classified some cryptocurrencies, including XRP, as digital commodities.

The CFTC said at the time the interpretation was intended to "increase clarity" on how crypto should be treated under each agency's laws. It said such measures differ in nature from laws passed by Congress. Because the joint interpretation is regulatory guidance rather than comprehensive legislation, its scope of application could change depending on future regulatory actions or court rulings.

The SEC also advanced work in August to establish crypto-specific rules. The proposed "crypto-asset regulatory framework" includes a $5 million exemption over 4 years and a separate exemption allowing up to $75 million for 12 months for issuances that meet certain requirements.

The proposal also includes a conditional safe harbour that could allow activity to fall outside the definition of an investment contract if certain business operations are permanently terminated. It is an attempt to set standards for when digital asset issuance and distribution could be excluded from determinations of whether something is a security.

The Senate vote also showed that the industry's desired legal framework is difficult to replace with only regulators' interpretations and proposed rules. While Grayscale highlighted regulatory progress, a broad legal framework at the level the CLARITY Act intended has yet to be secured. As a result, U.S. cryptocurrency market institutionalisation will hinge on regulators' follow-up measures and whether Congress pushes legislation again.

Today, the Senate did not advance the CLARITY Act to formal debate. While this was not the outcome we hoped for, the industry continues to make remarkable progress through the ongoing work of regulators like the SEC and CFTC. Grayscale remains committed to advancing clear,…