Crypto tried to buy Congress. It failed.

Por Jasper Goodman — POLITICO – TOP Stories

The cryptocurrency industry is facing a reckoning on Capitol Hill — and it could reverberate far beyond crypto.

Crypto companies have poured hundreds of millions of dollars into political spending and employed aggressive lobbying tactics to amass extraordinary clout in Washington. But the industry’s political muscle was unable to overcome the toxic partisan politics of the Trump 2.0 era this week in the Senate.

The high-flying crypto sector’s longtime top lobbying priority — a sweeping bill known as the Clarity Act — collapsed on the Senate floor on Tuesday, as Democrats said it did not go far enough to prevent President Donald Trump from profiting off his family’s digital asset ventures.

“First and foremost, it shows that the Trump administration refused to deal with the core ethics conflict-of-interest issues at the heart of this bill,” said Sen. Chris Van Hollen, a Maryland Democrat who opposes the crypto bill effort. “But I think it also should be a clear message that people aren’t going to be stampeded into passing something just based on tens of millions of dollars of super PAC money spent.”

The bill’s meltdown highlights the limits of what money can buy in Washington and offers a potential warning for other tech interests that have sought to replicate the crypto playbook of plowing eye-popping sums of money into super PACs to build influence in Washington. For the crypto industry, all the spending couldn’t overcome growing political backlash on the left over Trump’s crypto entanglements, costing the votes of a group of Democrats whose support was required to pass the bill.

Every Democrat and three Republicans opposed the measure, leaving the bill well short of the 60 votes that it needed to clear a first procedural hurdle on the floor. The GOP senators who voted against the bill were swayed by concerns raised by the banking industry, which was pushing for stricter language cracking down on crypto rewards programs that lenders see as a threat. If the bill had advanced, it was expected to shed more GOP support due to banks’ lobbying.

The legislation sought to establish a new regulatory framework for the crypto industry, which companies hoped would lock in legal certainty for their businesses and help legitimize digital assets as regulated, mainstream financial products.

Republicans and industry advocates say the outcome is not a referendum on crypto, or its influence.

“I don’t think it says anything about the crypto industry’s ability to get its way,” said Sen. Cynthia Lummis (R-Wyo.), the bill’s longtime leading advocate. “I think this got caught up in not policy, but in politics. And that’s it. This was a purely political move on the part of the Democrats. And no policy could have gotten their support.”

Crypto companies still enjoy significant influence in Washington. Democrats who worked on the bill say they are eager to remain at the table to try and pass it going forward — a sign that they aren’t abandoning the industry. And even if the Clarity bill never comes back to life on Capitol Hill — it appears likely that it won’t — Trump-appointed regulators are gearing up to roll out rules aimed at giving the industry the “regulatory clarity” it has long sought.

Faryar Shirzad, chief policy officer at Coinbase, the largest U.S. crypto exchange and a major lobbying force behind the bill, said in a statement that the “campaign for clear rules has always been mission-first and focused on sound crypto policy to ensure America’s leadership.”

“This bill would have provided durable protections for consumers both sides agree are direly needed, and comprehensive ethics restrictions on lawmakers,” he said. “Absent legislation, our efforts will continue – and federal regulators have already been moving forward. Our North Star remains constant: We will support those that support pro-crypto policy.”

Sen. John Kennedy (R-La.), a supporter of the measure who predicted it would come back to life during Congress’ lame-duck session following the midterm elections, said the bill ran into trouble “when the president filed his financial disclosure.” Disclosures released earlier this year revealed that Trump earned more than $1.4 billion in income through several cryptocurrency ventures in 2025.

“I knew when that happened that the Democrats were going to blow up and that they were going to insist on having their way on the ethics provision,” he said.

He added that he doesn’t “think it says anything” about crypto’s influence in Washington.

Regardless, the outcome is likely to have outsized political consequences in the runup to the midterms. Senate Democrats now face the possibility that a super PAC network known as Fairshake, which has more than $120 million in the bank, will be wielded against their candidates in battleground midterm races.

The PAC has financially backed industry allies in both parties in the past, including several Democrats who turned on the bill, but Republicans are now openly calling on crypto firms to reconsider backing Democrats at all.

“Clearly, the crypto industry’s influence is nonexistent with the Democrat Party,” said Sen. Bill Hagerty (R-Tenn.). “I know that there’s been a lot of effort put in place for the crypto industry to play in a bipartisan way. I think that’s turned out to be a rather naive approach. And my view is, this is a wake-up call to the industry. They ought to take this message that was sent by the Democrats today with all seriousness.”

But Democrats who oppose the crypto bill effort say the party shouldn’t bow to the industry. Some have found success in primaries this year in tying their opponents to crypto spending.

“People are looking at … all this big tech money that is basically trying to buy elections by using campaign money to pick their chosen candidate, and people are pissed about it,” said Sen. Tina Smith (D-Minn.). “They don’t like it.”

Other Democrats who have worked on the bill say they remain at the table. Sen. Angela Alsobrooks of Maryland said “this is an industry that absolutely has to be regulated.” But she said she will only vote for the measure if it includes an ethics provision that meaningfully reins in Trump’s ability to profit off of his family’s digital asset firms.

The Trump concerns are what ultimately overtook the bill. If not for that, “Clarity would have become law,” said Rep. Jim Himes (D-Conn.), who voted against the bill in the House but has supported industry-friendly crypto legislation in the past.

But Himes said the industry has work to do to convince lawmakers that its agenda is worth prioritizing.

“They instilled some fear around here, no question,” he said. “But what they really ought to do is go out there and produce some applications that actually improve the lives of a lot of Americans. Because right now, the Congress looks at these guys and they see Sam Bankman-Fried, they see a bunch of stuff like non-fungible tokens and the use of the medium by drug dealers. Go out there and produce some applications that actually have our constituents excited, like Uber did. They haven’t done that yet.”

Katherine Hapgood contributed to this report.

Fonte: POLITICO – TOP Stories