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CLARITY Act odds fade, Bernstein warns of another crypto valuation leg down

Bernstein says the Senate could start summer recess at the end of the week, raising the risk of a near term negative reaction for Bitcoin and the wider market while regulators step up Project Crypto rulemaking.

Reported · Written up by our desk · Regulation

Bernstein warned that Congress’ failure to pass the Digital Asset Market Clarity Act, known as the CLARITY Act, could trigger another drop in crypto valuations, with an immediate negative reaction for Bitcoin and the broader market. The wealth manager said the odds of CLARITY passage are fading as the US Senate is scheduled to begin summer recess at the end of this week. Bernstein linked the risk to what it described as an industry “knee-jerk reaction” after the legislation misses, potentially pushing prices lower again.

At the same time, Bernstein argued that a CLARITY setback could also bring more proactive US regulatory support. It said additional policy actions from the Commodity Futures Trading Commission and the Securities and Exchange Commission may accelerate rulemaking under Project Crypto, an initiative aimed at creating a workable regulatory framework for digital assets while Congress finalizes broader legislation.

Bernstein also said CFTC and SEC actions could include interpretive releases tied to token taxonomy, clearer rules around decentralized finance, and an accelerated innovation exemption for issuing tokens that would be exempt from securities status for a finite period. It added that prediction market traders are betting against CLARITY passage before the end of 2026.

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