Crypto Assets regulatory bill faces setbacks, Washington's "Crypto Week" is at an impasse

Originally regarded as an important moment for the Crypto Assets industry in Washington, the "Crypto Week" faced an unexpected setback on Tuesday. Three highly anticipated Crypto Assets regulatory bills failed to pass in a procedural vote, with a result of 196 votes in favor and 223 votes against. Notably, 13 Republican House members joined Democrats in casting votes against, collectively blocking the procedural motion to debate and advance the bill.

This result means that unless the House passes the relevant procedural rules again, these bills, which carry the hopes of the industry, will not be able to enter substantive debate. This is undoubtedly a blow to the crypto assets industry, which was originally full of expectations.

Before the voting, the sentiment in Washington's Crypto Assets industry was high, with widespread expectations that these bills would pass smoothly. The three bills include:

1. GENIUS Act: Aims to provide a clear regulatory framework for stablecoins and is seen as key to driving institutional adoption.
2. CLARITY Act: The goal is to clarify the classification rules for digital assets and specify the regulatory agencies for different assets.
3. Bill to Prevent Central Bank Digital Currency (CBDC): Aimed at prohibiting the Federal Reserve from creating a central bank digital currency.

These bills are considered the cornerstone of the United States' establishment of a comprehensive and predictable regulatory framework in the digital assets field, which could bring much-needed certainty to the market and attract more capital and innovation.

However, there are differences of opinion within the Republican Party. Thirteen Republican members of Congress, including Marjorie Taylor Greene from Georgia, voted against it. Greene explained on social media that her opposition was due to the GENIUS Act's failure to include a ban on central bank digital currencies (CBDC), and that Speaker Johnson did not allow related amendments to be submitted.

House Speaker Johnson stated that Republicans are still communicating to address questions and are trying to garner support from these conservatives. However, he also acknowledged that bundling all three bills into one "big package" is not feasible, reflecting the strategic dilemma faced by Republican leadership in balancing the demands of different factions within the party and ensuring legislative viability.

After the news of the failed vote broke, stocks related to Crypto Assets fell sharply. Stablecoin issuer Circle's stock price dropped by more than 7%, crypto trading platform Coinbase fell over 4%, and digital asset company MARA Holdings also saw a 2% decline in its stock price.

Nevertheless, some industry analysts remain optimistic about the future of the bill. TD Cowen policy analyst Jaret Seiberg expects the House to pass the GENIUS bill, believing that even if members of the House "Freedom Caucus" oppose accepting the Senate version of the bill, they may ultimately make concessions.

Cody Carbone, CEO of Digital Chamber, is also confident about the final passage of the bill. He pointed out that the passage of the GENIUS bill may be the best way to address the issue of banning CBDCs, while also promoting the development of the private stablecoin market in the United States.

This setback shows that even an agenda with high-level support can encounter resistance in a complex political environment. The regulatory path for Crypto Assets is still fraught with challenges and uncertainties.