Jefferies: The CLARITY Act Faces Key Senate Test, May Intensify Crypto Market Volatility

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Golden Finance reported that on July 1, investment bank Jefferies stated in its latest report that the US CLARITY Act still faces significant legislative hurdles in the Senate, and progress on related legislation in the coming weeks could exacerbate crypto market volatility.
Jefferies pointed out that although the bill previously passed the Senate Banking Committee with a bipartisan vote of 15 to 9, with only about 20 legislative days left before the August congressional recess, the Senate still needs to complete bill consolidation, procedural votes, reconcile with the House version, and submit to the president for signature, making the timeline extremely tight. Polymarket data shows that the probability of the bill passing by the end of 2026 has dropped from 70% in mid-May to 48%.
Jefferies believes that if the bill passes smoothly, it will establish a clear regulatory framework for digital assets, prompting banks, asset management institutions, and exchanges to accelerate their deployment of tokenized assets, custody, staking, lending, and other services, and promote more crypto ETFs and IPOs of crypto infrastructure companies. If legislation is delayed, it could prolong regulatory uncertainty, causing traditional financial institutions to slow down their blockchain business progress.
The report expects that the legislative process will continue to affect the market performance of crypto concept stocks including Circle (CRCL), Coinbase (COIN), Bullish (BLSH), and some crypto assets. Jefferies also pointed out that in the long run, compared to regulatory changes, the greater challenge for stablecoin issuer Circle still comes from competition from banks, fintech, and payment companies.
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