Amid a crypto market downturn, the US has returned to discussing the CLARITY Act. This bill is supposed to finally clarify how exactly to regulate digital assets and who will be responsible for different parts of the crypto market.
Kristin Smith believes the law could be passed as early as July 2026, although getting it through Washington will still be challenging. Analysts at JPMorgan share a similar view. They also expect a decision closer to the middle of the year.
At the same time, part of the market is even more confident. Brad Garlinghouse previously said the chances of the law passing could reach 90% as early as April. So within the crypto industry, many really believe that the CLARITY Act has a real chance to move forward.
What Went Wrong
At first, there was a lot of optimism around the CLARITY Act, but at the beginning of the year, the situation changed. The bill suddenly started to be discussed more critically.
One turning point was the position of Coinbase CEO Brian Armstrong. He refused to support the document and stated that some of its parts could play into the hands of traditional banks.
After this criticism, more doubts emerged in the industry. Many began to say that the law might not be passed in time for 2026. For a while, it even seemed that the discussion of the CLARITY Act could simply stop.
Political Obstacles Remain
Even with renewed interest in the bill, passing a standalone cryptocurrency law in Washington is still not easy. Unlike many other initiatives, the CLARITY Act cannot simply be added to major government funding bills without broad bipartisan support.
In addition, the document faces criticism from some politicians, including Elizabeth Warren, who has long opposed the crypto industry. At the same time, support from leaders like Chuck Schumer and Ruben Gallego could help advance the initiative in Congress.
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Meanwhile, the Donald Trump administration is also becoming more active in the discussion. Reports say his advisors David Sacks and Patrick Witt are working to resolve key regulatory policy issues.
Bullish and Bearish Scenarios for the Crypto Market
If the CLARITY Act is passed, many analysts believe it could create a bullish backdrop for the crypto market. Clear regulatory rules could attract institutional investors. The emergence of understandable standards could push banks, asset managers, and other financial organizations to expand their crypto services.
However, a bearish scenario is also possible. If political disagreements delay the law or seriously change its structure, uncertainty may persist. In this case, institutional capital will act more cautiously, and the adoption of cryptocurrencies in the US market may slow down.
Is It Time to Buy the Dip?
Market analysts also note that regulatory news often affects sentiment around bitcoin. Crypto analyst Ted Pillows recently pointed out that a drop in BTC below $68,000 could lead to a retest of the support zone at $65,000–$66,000 if the price does not quickly return above $70,000.
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Historically, major regulatory events often follow the principle of ‘buy the rumor, sell the news.’ This means the market often rises before important announcements, and then enters a consolidation phase afterward.
If the CLARITY Act starts to move forward in the coming months, traders may once again start taking positions in advance, even before an official decision.
What This Could Change for the Crypto Market
Right now, many crypto companies in the US are operating almost blindly. Rules are constantly changing, and different regulators interpret the same things differently. That is why there is so much talk around the CLARITY Act.
If the law is passed, the situation could become clearer. Exchanges, fintech companies, and large funds will get more defined frameworks for operations. This could simplify the launch of new crypto products and reduce regulatory risks.
That is why the market is closely watching what happens around this bill. Its fate could affect not only the US, but also the overall sentiment of the entire crypto market.
