Regulatory Fill-in-the-Gaps: Crypto Can Advance Without CLARITY Act

The CLARITY Act, aimed at establishing a comprehensive rulebook for digital assets in the US, faces low odds of passing this year due to Senate scheduling and election-year politics. Grayscale's Head of Research, Zach Pandl, points out that even without new market structure legislation, Bitcoin's demand as a store of value remains steady, and stablecoin payment growth is expected to continue.

Pandl expects regulators to fill the legislative gaps through rulemaking on tokenized securities. The SEC and other agencies have already taken steps to support digital assets, including new rules around institutional custody and improved banking access for crypto firms.

While comprehensive domestic legislation may be delayed, Pandl notes that existing regulations can still facilitate growth in the industry. However, some activity may shift overseas due to friendlier token issuance rules and developer protections abroad.