1431 ET - The failure of the crypto-friendly Clarity Act in Congress removes a positive catalyst for the crypto space but doesn't create any kind of new regulatory shock, Morgan Stanley analysts say in a research note. Regulation of digital assets in the U.S. has already moved materially over the past year, reducing the enforcement risks that historically constrained product development and institutional participation, the analysts say. While the failed vote may hurt near-term sentiment around crypto investing, the industry itself seemed prepared for it, given that prediction market odds for the vote passing had fallen by the time the vote was held, they say. "Disappointment largely priced in," the analysts say.