Bitcoin, XRP, CLARITY Bill Failure Sparks Fed Rate Tension

The cryptocurrency market is holding its breath as it awaits the Federal Reserve's interest rate decision on September 16, which comes just one day after the CLARITY Act was rejected in the Senate.

XRP fell nearly 10% to approach $1.30, while Bitcoin dropped below $76,000. Over $300 million in leveraged positions were liquidated within minutes.

The Senate failed to pass the CLARITY Act on September 15 with a vote of 49-50, falling short of the required 60 votes for passage. The bill aimed to clarify jurisdiction over digital assets between the SEC and CFTC. Republican Senator Thom Tillis confirmed he will continue pushing for the legislation, though Polymarket predicted its 2026 passage probability dropped from around 30% to just 5% within a day.

Analyst Eric Bollinger called Tuesday's procedural vote failure "effectively equivalent to the bill being scrapped," while others remain hopeful. The focus has now shifted entirely to Wednesday's Fed decision, with markets pricing in a 92.5% chance of a 25bps rate hike, potentially raising rates to 3.75%-4.00%, marking the first increase since 2023.

With Treasury yields nearing 5%, risk assets face pressure, and analysts say the tone of Fed Chair Kevin Warsh's comments will be more critical than the rate hike itself. A hawkish stance could deepen losses, while a dovish one might ease pressure on Bitcoin and altcoins.