Summary:
- Bitwise CIO Matt Hougan believes institutional adoption and SEC rulemaking can sustain crypto growth without the Clarity Act passing Congress.
- Senate recess leaves lawmakers with limited time, while delayed legislation could return through a year-end omnibus package for further consideration.
- Political disputes and declining prediction market odds have weakened confidence despite expanding institutional blockchain investment.
Crypto may not depend on the U.S. Clarity Act to maintain its regulatory momentum. According to Bitwise Chief Investment Officer Matt Hougan, expanding institutional adoption and expected SEC rulemaking have already positioned the industry to move forward even if the legislation fails to pass the Senate this week.
According to Hougan, the cryptocurrency market has reached a stage where its growth no longer depends on a single congressional vote. Instead, supportive regulators and increasing participation from major financial institutions have created multiple paths for the industry to expand.
The Senate is expected to begin its summer recess on Aug. 10, leaving lawmakers with only a limited period to approve the Clarity Act. If the bill does not advance before then, Congress could postpone further consideration until later this year.
According to Hougan, that outcome would not stop the industry’s momentum. He pointed to recent comments from SEC Chair Paul Atkins, who indicated that the agency has authority to establish regulations covering many of the same issues addressed by the proposed legislation.
Hougan explained that SEC-led rulemaking could initially produce a more innovation-friendly framework than a bipartisan congressional bill. However, he acknowledged that future administrations could appoint regulators with different policy priorities.
Also Read: Bitcoin (BTC) Holds Above $64K as BNB (BNB) Leads Major Coins While Cysic (CYS) Doubles
Institutional support reduces reliance on legislation
According to Hougan, one of crypto’s strongest advantages is the growing commitment from established financial companies. He noted that BlackRock, Nasdaq, JPMorgan, and Visa have already expanded their blockchain and digital asset initiatives.
Moreover, Hougan argued that this institutional participation makes it increasingly difficult for future regulators to reverse the industry’s progress. He added that the market would still have more than two years under the current SEC leadership to strengthen its position before another administration could appoint a different SEC chair.
Additionally, broader adoption during that period could further reduce the impact of future regulatory changes. Consequently, the industry’s foundation would rely less on political developments and more on long-term institutional investment.
Despite that confidence, Hougan warned that failure to pass the Clarity Act this week would leave the proposal in what he described as a “walking dead” state. He explained that the legislation would remain active while losing immediate momentum in Congress.
According to Hougan, lawmakers could revisit the measure during the fall or winter legislative sessions. He also suggested Congress could attach it to a broader year-end omnibus package to improve its chances of approval.
Political obstacles weigh on the bill’s future
Prediction market data reflects weakening confidence in the Clarity Act’s prospects, with Polymarket assigning a 15% probability that the legislation becomes law before the end of 2026, down from roughly 75% in mid-May.
Political disagreements have also complicated the legislative process, as Democratic lawmakers continue raising concerns over President Donald Trump’s cryptocurrency interests. Meanwhile, several senators and tribal gaming regulators support adding restrictions on sports-related prediction markets to the legislation.
Those issues have reduced expectations that the bill will reach President Trump’s desk before Congress begins its August recess. As a result, uncertainty surrounding the regulatory framework could persist until lawmakers return later in the year.
Conclusion
Congressional approval would still provide the cryptocurrency industry with clearer legal standards and greater regulatory certainty. Nevertheless, institutional adoption and potential SEC rulemaking have already created an alternative path that could allow the market to expand even if the Clarity Act misses this week’s deadline.
Also Read: Bitcoin (BTC) Holds Above $64K as BNB (BNB) Leads Major Coins While Cysic (CYS) Doubles
