CLARITY Act Failure May Spur Faster SEC Rulemaking

Analysts at Bernstein have expressed concerns that the CLARITY Act may not pass in 2026, citing decreasing odds of its success. If the bill fails, regulators could accelerate rulemaking under Project Crypto.

Bernstein experts believe that without a new law, the SEC and CFTC will step up their work on rules for the crypto industry, including guidance on token classification, DeFi and self-custody, and an 'innovation exemption' to temporarily allow certain tokens to be issued without being treated as securities.

The analysts also expect regulators to continue supporting the development of tokenized real-world assets (RWA), perpetual futures on such assets, and prediction markets, even if the CLARITY Act fails. However, they noted that a potential failure of the bill would be 'disappointing' as it could have provided long-term regulatory clarity.