Seven Senate Democrats who voted Tuesday to block the Clarity Act said Wednesday evening that they still intend to pass crypto market structure legislation. The statement landed badly. Within hours, investors, analysts and legal scholars were describing it as midterm positioning rather than the opening of a new negotiation.

The signatories were Sens. Kirsten Gillibrand (D-NY), Angela Alsobrooks (D-MD), Cory Booker (D-NJ), Catherine Cortez Masto (D-NV), Ruben Gallego (D-AZ), Mark Warner (D-VA) and Raphael Warnock (D-GA). “This week was a setback, but not the end of that important work,” they wrote, saying they remain committed to a bipartisan path. All seven voted against Tuesday’s cloture motion, which drew 49 votes and needed 60.

The reaction from crypto was close to uniform. Bitwise Chief Investment Officer Matt Hougan posted “Fool me once…” NovaDius Wealth Management President Nate Geraci argued that the previous administration ran regulation by enforcement with no bipartisan effort on crypto, and that actions speak louder than words. J.W. Verret, a law professor, read the statement as a plea that crypto PAC money not be spent against the signatories through the midterms. The industry is now treating the Senate as a lagging indicator and setting expectations off the agencies instead.

SEC Chair Paul Atkins and CFTC Chair Michael Selig both said Wednesday they will act without legislation. A separate House panel approved the first federal crypto tax framework the same day.

What broke the bill was ethics, not market structure. Democrats wanted restrictions covering President Trump’s crypto wealth. Warner said afterward that the conflict of interest made it impossible for him to support moving forward. The House cancelled its last two weeks of September, so even a revived Senate bill could not reach a House floor vote until after the November elections.

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