Bitcoin Is Rallying Despite The CLARITY Act's Failure. Crypto Investors Are Looking Past The Regulatory Setback.

Bitcoin climbed above $85,000 Monday, reaching its highest level since January as the cryptocurrency extended a sharp rebound despite last week's defeat of legislation that the industry had spent years pushing through world's largest cryptocurrency was trading around $84,600, up more than 5% over the previous 24 hours, after climbing above $85,000 earlier in the session, data from CoinMarketCap showed. Bitcoin has gained more than 7% over the past five days and roughly 35% over three months, although it remains below its October 2025 record above $126,'s recovery has followed a steep decline from last year's record. The cryptocurrency had fallen to around $60,000 in late August, its lowest level in about two years, before moving back above $70,000 earlier this month. Spot bitcoin exchange-traded funds also recorded renewed inflows during that rebound, Reuters noted last gains have continued despite a major setback for the crypto industry's legislative agenda in Washington. The Senate voted last Tuesday against advancing the CLARITY Act, legislation intended to establish a federal framework for digital assets and more clearly divide oversight between the Securities and Exchange Commission and Commodity Futures Trading procedural vote received 50 votes in favor, short of the 60 needed to advance the measure, while four Republicans joined Democrats in opposing it. The result stalled legislation that had been backed by President Donald Trump and heavily promoted by the cryptocurrency bill's defeat initially weighed on crypto-related assets, including bitcoin and shares of Coinbase and Circle. The industry had spent more than $300 million on political efforts in recent election cycles as it sought a clearer federal regulatory CLARITY Act would have followed the GENIUS Act, which established federal rules for payment stablecoins and was signed into law last year. With the broader market-structure legislation stalled, the SEC and CFTC continue to play central roles in determining how existing securities and commodities laws apply to digital Chief Investment Officer Matt Hougan told CNBC that the absence of legislation leaves regulators with greater influence over the industry's immediate regulatory environment. He pointed to the current leadership at both agencies and said regulatory conditions remain favorable for the sector despite the Senate SEC last week separately granted a five-year innovation exemption allowing qualifying U.S. trading venues to offer tokenized versions of publicly traded stocks under specified conditions. The measure is part of the regulator's effort to establish rules for blockchain-based securities 's rally has also unfolded against a volatile backdrop across financial markets. The Federal Reserve raised interest rates last week for the first time in more than three years, while higher oil prices and the continuing Middle East conflict had pushed Treasury yields higher and increased inflation rose alongside other risk assets as oil retreated. U.S. equity futures advanced Monday morning, with Nasdaq futures gaining more than 1% at one stage, while European technology shares also moved higher. Crypto-linked stocks joined the advance, with Coinbase and bitcoin holder Strategy gaining in U.S. premarket major cryptocurrencies rose alongside bitcoin. Ether, Solana and Hyperliquid's HYPE token were each up about 3% earlier Monday, while XRP gained around 4%.