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 former President Donald Trump failed to pass a key procedural vote in the U.S. House of Representatives on Tuesday. Media analysis suggests 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 was 196 in favor and 223 against, with 13 Republicans joining Democrats in opposing the procedural motion. Conservative members of the House had previously expressed dissatisfaction by voting to block procedural steps. It remains unclear how this vote will affect the final outcome of the bills; if 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 it is still unclear whether the second vote later on Tuesday will address the same rules and bills or if House Republican leaders will modify the content of the bills to meet the demands of 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 bills, like the Clarity Act and the anti-Central Bank Digital Currency (CBDC) bill you know about." "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 they must be combined into one package." This vote took place during what is referred to as "Crypto Week," and media reports noted that House Republicans unusually 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 saw its stock price drop more than 2% at one point, later narrowing the decline to around 1.8% However, even with the decline on Tuesday, Circle's stock price is still more than six times higher than its IPO price. Circle is the issuer of USDC (the second-largest dollar-pegged stablecoin globally), with a market share of approximately 24%. Media reports state 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, underpinning 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. David Sacks, the White House's Director of AI and Crypto Affairs, 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 has $141 million in cash on hand to advocate for regulatory victories and support pro-crypto candidates in the 2026 midterm elections