The U.S. crypto industry had waited years for Congress to deliver what it has long wanted: a lasting rulebook for digital assets that would clarify which tokens fall under the oversight of the Securities and Exchange Commission (SEC) and which fall to the Commodity Futures Trading Commission (CFTC). Such a framework would have given businesses and investors greater certainty than relying largely on regulators whose policies can change between administrations.

Those hopes suffered a setback on Sept. 15, when the Clarity Act failed a procedural vote in the Senate, drawing 49 votes in favor and 50 against, well short of the 60 needed to advance — the Senate's standard threshold for moving most legislation past the debate stage. Negotiations had foundered over ethics restrictions on senior officials' crypto business interests — including President Donald Trump's — alongside concerns about investor protection and illicit finance. With the November midterms approaching and little legislative time remaining, the defeat sharply reduced the chances of passage this year, leaving regulators to fill the gap.

The question now hangs over another booming corner of crypto: dealmaking. Crypto M&A has hit record levels this year, but the bill's Senate defeat leaves dealmakers weighing how much regulatory uncertainty still matters.

Fewer deals?

On the face of it, the bill's failure to advance might be expected to dampen crypto mergers and acquisitions. Regulatory uncertainty could make potential buyers — especially traditional financial firms — less willing to pursue acquisitions in the U.S., particularly when a target business depends on tokens or activities whose regulatory treatment could change.

But bankers and investors who spoke to CoinDesk don't expect the Clarity Act's setback to slam the brakes on crypto M&A. Instead, they describe a more uneven effect: deals in areas where regulators have already provided clearer rules may keep moving, while businesses exposed to unresolved regulatory questions could remain harder to buy.

“The Clarity Act's setback doesn't change the trajectory,” said Paul McCaffery, head of digital assets at investment bank KBW. His argument: Congress isn't the only game in town.

“The SEC and CFTC are already moving proactively to provide the regulatory certainty markets need, and that's unlocking a wave of M&A across digital assets, traditional financial services, and fintech alike,” McCaffery said.

Regulators have, in fact, been active. Just two days after the Senate vote, the SEC approved a temporary “Innovation Exemption” allowing limited trading of tokenized U.S. stocks on certain onchain venues. Then on Oct. 1, the agency proposed a new rule to clarify how investment firms can handle and keep customer crypto assets. Meanwhile, the CFTC has also been removing some regulatory barriers, including providing relief to certain software providers and updating guidance around tokenized investments and blockchain-based recordkeeping.

“We're in the early innings of a tokenization and digital payments supercycle that's building internationally first, but it will inevitably come back to the U.S., and those who wait for Congress will miss the boat,” McCaffery said. “It's taken a long while to get here, but the convergence is real and buying vs. building is the more efficient route.”

Todd White, partner at advisory firm Architect Partners, similarly expects regulatory action outside Congress to keep activity moving, particularly around tokenization.

“SEC's decisive move in the wake of legislative failure feels poised to catalyze activity around tokenization, for both commercial traction and strategic transactions. We'd already seen significant shifts toward more liquid assets and institutional finance. The new ‘Innovation Exemption should bolster that momentum,” White said.

What the numbers show

Dealmaking in the digital asset sector reached a record $9.7 billion in disclosed deal value in the first half of 2026, up 44% from a year earlier, according to CryptoRank Research. There is a caveat: the number of announced acquisitions fell 8% year over year to 87, and the four largest deals accounted for 76% of disclosed value — underscoring a market driven by a handful of large transactions rather than a broad rise in activity.

Payward, Kraken's parent company, offers an example of what's driving some of those deals. The company agreed to buy payments company Reap for $600 million and derivatives platform Bitnomial for up to $550 million, while Nasdaq agreed to invest $100 million in Payward alongside an expanded commercial partnership.

Those transactions highlight an appetite for licenses, technology and distribution that could sustain activity even as comprehensive U.S. crypto legislation remains stalled.

Clarity still matters

Not everyone thinks regulatory action by the SEC and CFTC can substitute for legislation.

“Clearer legal framework would absolutely result in more deals, more partnerships permeating across financial services and beyond, and ultimately more economic prosperity for both citizens in the U.S. as well as abroad,” said Dmitriy Berenzon, partner at venture firm Archetype. “We have already seen how much of a positive impact the GENIUS Act has had on stablecoin adoption, so the more clear and informed the rulemaking, the better,” he added. Signed into law in July 2025, the GENIUS Act established a federal regulatory framework for payment stablecoins.

Jake Brukhman, founder and CEO of venture capital firm CoinFund, offered a more holistic reading of the Clarity Act's setback: it doesn't necessarily make the regulatory environment worse — it just means the improvement buyers were hoping for hasn't arrived.

“Failure of Clarity does not create a new drag so much as preserve the regulatory uncertainty already weighing on the sector,” he said, noting that the impact won't be the same everywhere. “It prevents a meaningful regulatory de-risking that could have accelerated dealmaking, particularly for token-centric companies and pre-token financings. Equity-based infrastructure, payments, and businesses operating under clearer existing rules should be less affected,” Brukhman said.

Will Nuelle, general partner at Galaxy Ventures, sees a similar divide. A clearer legal framework for digital assets would lead to more deals in the sector, “though the effect would be uneven rather than uniform,” he said.

“Deal activity has already concentrated in categories the SEC and CFTC have de-risked through Project Crypto and joint guidance, like exchange infrastructure, spot trading, and tokenized collateral,” Nuelle said. Project Crypto is the SEC's initiative, unveiled in 2025, to modernize securities rules so markets can operate on-chain.

So the question now is whether buyers will keep pursuing those strategic opportunities while Washington works toward a lasting rulebook, or whether prolonged uncertainty will make them hesitate. Among the developments to watch: whether the SEC's custody proposal advances toward finalization, and whether the Senate returns to market structure legislation after the November midterms.

“In general, regulatory frameworks are helpful, particularly for institutional adoption, which can be a supportive tailwind for entrepreneurs building in the space and is obviously supportive for M&A,” Nuelle said.