Republican lawmakers defect! The cryptocurrency regulation bill supported by Trump faces a major setback, failing to pass in the House vote

Several cryptocurrency-related bills supported by U.S. President Donald Trump failed to pass a key procedural vote in the U.S. House of Representatives on Tuesday. Media analysis indicates that this is a significant blow to the cryptocurrency industry. As a result, Bitcoin fell 2.66% during the day, and the stock price of stablecoin company Circle dropped more than 7% at one point.

Republican lawmakers defect, Speaker: Some want to bundle the bills

The final vote in the House resulted in 196 votes in favor and 223 votes against, with 13 Republicans joining Democrats in opposing the procedural motion. Conservative members of the House had previously expressed their dissatisfaction by blocking procedural steps. It remains unclear how this vote will affect the final outcome of the bills; if the leadership can garner enough support, the bills may still be considered.

House leadership has tentatively planned to hold another vote later on Tuesday to continue pushing these bills. Media reports indicate that it is still unclear whether the second vote later on Tuesday will address the same rules and the same bills, or whether House Republican leaders will modify the content of the bills to meet the demands of the opponents.

House Speaker Johnson stated after the vote that these hardline critics want to combine several cryptocurrency bills into one package, which is why they blocked the procedural vote:

“Some members are very, very eager to emphasize the House version of the bill, such as the Clarity Act and the anti-central bank digital currency (CBDC) bill.”

“We also have our own bills, and they want to push and combine these. We are trying to work with the White House and our partners in the Senate. I think everyone is committed to doing these three, but some insist that they must be combined into one proposal.”

This vote took place during what is referred to as "Crypto Week," and media reports noted that House Republicans rarely did not follow Trump's directives. Earlier on Tuesday, Trump praised "Crypto Week" on his social platform Truth Social and urged all House Republicans to vote in favor of the related bills.

“The House will soon vote on a great bill that will make America the undisputed, number one leader in the digital asset space—no one can do it better!”

“The GENIUS Act will put our great country far ahead of others that are desperately trying to catch up but just can’t. Digital assets are the future, and we are far ahead! Complete the first vote this afternoon (all Republicans should vote yes!)”

Cryptocurrency stocks decline

After the vote failed, stocks related to cryptocurrency began to decline. The stock price of stablecoin company Circle dropped more than 7% at one point, later narrowing the decline to around 4.5%. Coinbase's stock price fell more than 4% at one point, later narrowing the decline to around 1.4% Digital asset company MARA Holdings' stock price once fell more than 2%, with the decline later narrowing to around 1.8%.

However, even with the drop on Tuesday, Circle's stock price is still more than six times higher than its IPO price. Circle is the issuer of USDC (the world's second-largest dollar-pegged stablecoin), with a market share of about 24%.

Media reports indicate that this set of legislation, including the GENIUS Act, if passed, will establish federal-level regulatory rules for stablecoins for the first time. Stablecoins are a core part of the $260 billion cryptocurrency market, supporting most digital asset transactions. The bill stipulates full reserve requirements, monthly audit obligations, and provides a pathway for private companies to issue regulated digital dollars with U.S. government approval.

The GENIUS Act was passed in the Senate last month, marking not only an important milestone for the cryptocurrency industry but also a victory for Trump, who has been advocating for the government to align with digital asset innovation. This also signifies a win for the industry, which spent over $245 million during the 2024 election cycle to help elect what is considered the most pro-crypto Congress in U.S. history.

U.S. Treasury Secretary Yellen stated that if this bill takes effect, the U.S. stablecoin market could grow eightfold, exceeding $2 trillion. White House AI and crypto affairs director David Sacks previously predicted that this would create "trillions of dollars" in demand for U.S. Treasury bonds almost overnight.

Media reports indicate that just hours before the vote, Fairshake (the most powerful political action committee in the cryptocurrency industry) disclosed that it had $141 million in cash on hand to advocate for regulatory victories and support pro-crypto candidates in the 2026 midterm elections.

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