XRP Falls After Senate Rejects Clarity Act

The setback matters because the Clarity Act was meant to define which US regulators oversee digital assets and give the industry a framework it has sought for years. Instead, the collapse pushes that responsibility back toward the Securities and Exchange Commission and the Commodity Futures Trading Commission, leaving token issuers, exchanges and funds facing the same regulatory uncertainty that has kept many institutions cautious.

The political failure also hit leverage hard. CoinGlass data showed about $300 million of crypto long positions were liquidated within 20 minutes of the vote, and $770 million was wiped out over 24 hours, including roughly $203.5 million in Ethereum longs and $191.4 million in Bitcoin longs.

For investors, the vote removes a near-term catalyst for a sector that had been hoping Congress would ease legal risk and unlock broader institutional adoption. It also raises the odds that any durable rulebook will come instead from regulators through slower, narrower processes rather than a single sweeping law.

The defeat does not kill the legislation outright, but a deal this year now looks remote. Traders will be watching for fresh lobbying in Washington, any SEC or CFTC rulemaking, and whether XRP and the wider crypto market can hold support after the liquidation wave.