Bernstein analysts warn that the CLARITY Act (H.R. 3633) is increasingly unlikely to pass, with Senate odds dropping to just 31%. However, they suggest this failure could paradoxically accelerate rulemaking by the SEC and CFTC through their joint initiative, Project Crypto. This combined program, launched in 2025, focuses on token taxonomy, self-custody interpretations, and possible exemptions. Bernstein anticipates short-term volatility in digital asset markets, but expects clearer regulatory frameworks to ultimately boost institutional investor confidence. The risk remains that agency rulemaking not enshrined in statute could be reversed by a future administration.
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