The Senate blocked the CLARITY Act and the Fed hiked for the first time since 2023, yet Bitcoin ended the week above $81,000 which made for positive sentiment and crypto news.
Crypto got the two worst outcomes it was bracing for last week, and still finished higher. The Senate blocked the industry's flagship market-structure bill on Tuesday, the Federal Reserve delivered its first rate hike in more than three years on Wednesday, and Bitcoin ended the week above $81,000 anyway.
Both blows were largely priced in before they landed, and the market treated the confirmation as a reason to stop selling rather than start.
Here is what happened between 14 and 20 September, and what it sets up for this week.
The Digital Asset Market Clarity Act fell at its first Senate floor test. Cloture on the motion to proceed to H.R. 3633 failed 49 to 50 on 15 September, according to the Senate roll call, well short of the 60 votes needed to open debate.
The vote was procedural rather than final, and the bill is not formally dead. Senator Thom Tillis entered a motion to reconsider immediately after, which keeps it available for another attempt. But the arithmetic that sank it has not changed: with 53 Republicans in the chamber, supporters needed at least seven Democrats and did not get them.
The dispute that broke the coalition was ethics, specifically rules on officials' crypto holdings, rather than the core SEC and CFTC framework the industry cared most about. A letter from 18 state attorneys general, sent the day before, gave undecided senators a bipartisan reason to hold back.
Prediction markets had already moved. Odds of passage in 2026 fell into single digits on Polymarket after the vote, extending a slide from 82% in February.
A day later, the Federal Open Market Committee raised the federal funds target range by 25 basis points to 3.75% to 4.00%, a unanimous 12 to 0 decision, according to the Fed's statement. It is the first increase since July 2023, after five straight holds this year.
The move was fully expected, with CME Group's FedWatch tool pricing a 92.9% chance of a hike that morning. What mattered more was the path. The committee's updated projections point to one more quarter-point increase before the end of 2026.
Chair Kevin Warsh gave little away on the next step, declining to offer forward guidance and describing an economy that is strengthening rather than slowing. That framing, that current conditions are not especially restrictive, is the part rate-sensitive assets will keep reacting to.
Bitcoin traded near $75,800 before the Fed decision, down almost 3% on the day after the CLARITY vote. Amid briefly slipped below $76,000 as the hike landed.
Then it turned. Bitcoin rallied more than 6% on Friday and held the gain through the weekend, trading as high as $82,078 on Monday morning in Singapore, above $81,000 for the first time in a fortnight, according to Bloomberg.
ETF flows tell the same story of a market that wobbled and recovered. US spot Bitcoin ETFs took in $593 million across Thursday and Friday, fully offsetting heavy outflows earlier in the week to finish just $6 million positive, according to Bloomberg.
Grayscale head of research Zach Pandl framed the hike as a small course correction rather than the start of the aggressive tightening cycle that drove crypto down in 2022. That reading, a single hike rather than a campaign, is what the market is currently pricing.
Grayscale launched four Model Portfolios for financial advisors on 14 September, packaging its exchange-traded products into ready-made allocations, including a Core Plus model capped at 40% per asset.
Standard Chartered initiated coverage of Arbitrum on 15 September with a $10 target for ARB by the end of 2030, calling it "the blockchain for TradFi," while acknowledging the token has no direct way to capture the network's revenue today.
In Washington, the House Ways and Means Committee advanced a federal crypto tax bill 38 to 5, covering de minimis treatment for small transactions and the tax treatment of staking.
Rulemaking is now the main event. With Congress stalled, the SEC and CFTC carry US crypto policy for the rest of the year, and the SEC's proposed crypto offering framework is open for public comment until 20 October. Agency rules can move faster than legislation, but they are also easier for a future administration to reverse.
On macro, the next marker is the minutes of last week's Fed meeting on 7 October, which will show how united the committee really is behind a second hike. Until then, Bitcoin's ability to hold above $80,000 after absorbing both a failed bill and a rate increase is the clearest read on where risk appetite sits.
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