The Senate's fight over cryptocurrency regulation has narrowed to a $25 million audit requirement after a procedural vote on the broader CLARITY Act failed on September 15. The cloture motion fell short by 11 votes, receiving 49 votes in favor and 50 against, when 60 were needed to advance the 635-page bill.
The audit threshold has become a focal point following Senator Cynthia Lummis's September 20 statement that Democrats rejected a transparency measure they had themselves requested during negotiations. Under the CLARITY draft, crypto projects raising more than $25 million from the public must provide financial statements audited by an independent public accountant. Projects raising $25 million or less require only reviewed financial statements.
The disclosure requirements extend beyond financial reporting. Projects would also report management details, legal proceedings, risk factors, major ownership positions, and related-party transactions. Lummis's office cited the $25 million threshold as one of 126 Democratic-requested provisions in the final text, alongside other changes including a reduction of the annual Regulation Crypto fundraising cap from $75 million to $50 million and a $200 million lifetime ceiling on fundraising under that framework.
Despite the audit rule's inclusion in the draft, the Senate did not vote directly on it. Instead, lawmakers voted on whether to proceed to consideration of the broader bill. All 49 yes votes came from Republicans. Four Republicans also voted no, with Senator Thom Tillis voting no to preserve a procedural avenue for reconsideration.
Democratic senators cited multiple unresolved issues beyond the audit threshold. Senator Mark Warner raised concerns about ethics restrictions involving senior public officials. Senator Catherine Cortez Masto pointed to illicit finance, law-enforcement powers, prediction markets, and ethics provisions. Seven Democratic senators later stated the setback was not final and committed to continued bipartisan discussions.
The $25 million requirement remains part of the draft, but its fate depends on resolving the wider disagreements that blocked the procedural vote.
