Bitcoin fell as much as 5% to $76,110 on Tuesday after the U.S. Senate failed to advance the CLARITY Act, extending losses that had begun before the procedural vote. Ether dropped more than 8.3% at one point, while smaller cryptocurrencies experienced steeper declines. Both Bitcoin and Ether posted their largest daily drops since June.
The Senate procedural vote on the CLARITY Act ended with 49 senators in favor and 50 against. The bill required 60 votes to advance, falling 11 votes short. The failure puts efforts to pass U.S. crypto market structure legislation this year in serious doubt, even after both sides had made significant compromises.
Prior to the vote, President Donald Trump agreed over the weekend to ethics provisions he had previously opposed. The provisions would require federal officials and their spouses to either sell significant financial stakes in crypto issuers or move those holdings into a blind trust, with state attorneys general given a role in enforcing the restrictions. Republican negotiators noted the final bill incorporated more than 120 Democratic demands across its 600-plus pages.
Market turbulence extended beyond cryptocurrencies. U.S. stock futures were slightly higher early Wednesday as investors awaited the Federal Reserve's interest rate decision. S&P 500 futures rose 0.22%, Nasdaq-100 futures gained 0.3%, and Dow futures added 0.2%. Futures were pricing in a 92% chance of a quarter-point rate hike on Wednesday.
Oil prices also climbed, adding to inflation concerns. West Texas Intermediate jumped 4.4% to $105.83 a barrel, its highest closing level since May 19, after Saudi Arabia reportedly cancelled some shipments following drone attacks on a major export pipeline. Brent crude rose 2.9% to $108.75.
Treasury yields climbed alongside expectations of sustained high prices. The 10-year Treasury yield was slightly above 5%, while the 30-year yield reached 5.369%.
