Major Changes in US Cryptocurrency Regulation: CLARITY Act Vote Imminent, Institutional Funds Poised to Launch

On January 15th, the U.S. Senate Banking Committee will hold a critical vote on the CLARITY Act. This legislation, regarded as a milestone in cryptocurrency market regulation, explicitly defines the classification and regulatory responsibilities of digital assets at the federal level for the first time, potentially ending the long-standing regulatory uncertainty that has plagued the industry. The market has already priced in this expectation in advance, with Bitcoin holding steady around $90,000, and institutional funds gearing up for deployment.

Core of the Legislation: Clarifying Responsibilities and Removing Compliance Barriers

The core innovation of the CLARITY Act lies in establishing a systematic classification system and a clear division of responsibilities. According to the draft, the bill categorizes digital assets into three main types:

This division is believed to help alleviate the friction between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) over regulatory boundaries that has persisted for years. Over the past five years, this ambiguity in responsibilities has led to high compliance costs and stifled innovation, causing many projects to hesitate to operate in the U.S.

Enhancing Market Transparency and Combating Manipulation

The bill also strengthens measures against market manipulation. It explicitly includes false trading, spoofing, and other deceptive behaviors within the scope of targeted regulation, and promotes the introduction of stricter reserve proof mechanisms and real-time monitoring systems on domestic trading platforms. These measures directly address longstanding issues in the crypto space and are expected to significantly improve market transparency and risk management capabilities.

Market analysts suggest that this regulatory framework aims to reduce the impact of extreme market conditions on investor confidence and prevent events like the severe volatility expected in 2025 from recurring. The more flexible CFTC regulatory approach also provides a more friendly environment for innovative projects, helping to shift the market from “regulatory evasion” to “compliance building.”

Market Reaction: Priced in the Clarity of Regulation

From market performance, investors have already begun to price in this expectation. Bitcoin remains around $90,000 ahead of the vote, with some small and mid-cap cryptocurrencies experiencing modest gains. This reflects positive market sentiment regarding the reduction of regulatory uncertainty.

Institutional capital is particularly noteworthy. Recent data shows that the total assets under management of U.S. spot Bitcoin ETFs have surpassed $115 billion, with net institutional buying outpacing new supply from miners by approximately 75%-76%, creating a clear supply-demand imbalance. This indicates that institutional investors are preparing for the potential regulatory clarity.

Possibility of Passage: Bipartisan Cooperation Needed

However, the bill’s final fate remains uncertain. According to the latest reports, the Senate typically requires at least 60 votes to advance legislation. The Republican side needs to secure support from 7 to 10 Democrats to ensure passage.

Galaxy Research Director Alex Thorn pointed out that if the Banking Committee’s vote does not demonstrate strong bipartisan cooperation, the likelihood of the bill passing in 2026 will significantly decrease. If Democrats delay the vote, the bill might not pass until 2027 and could take effect in 2029. This means that even if it passes the committee, it still must survive a full Senate vote.

Long-term Significance: Reshaping the U.S. Crypto Market Structure

If the bill passes smoothly, its long-term impact could be profound. A clear regulatory framework is expected to unlock previously hesitant institutional capital. Once rules are predictable, asset managers, custodians, and structured product providers will find it easier to participate. This could accelerate growth in areas such as:

• Expansion and innovation of ETF product lines
• Improvement of compliant custody ecosystems
• Regulation of derivatives markets
• Increased trust in decentralized finance (DeFi) applications

From a broader perspective, the CLARITY Act is not just a short-term positive but a systemic reform that could fundamentally change how the U.S. crypto market operates. It marks a key step in moving U.S. regulation from controversy to institutional development.

Summary

With the vote on the CLARITY Act approaching, the market is at a critical juncture. The core value of the bill lies in clarifying the classification and regulatory responsibilities of crypto assets, removing institutional entry barriers. While bipartisan cooperation is necessary for passage and uncertainties remain, the market has already priced in this expectation. Regardless of the short-term voting outcome, the progress of this legislation indicates that U.S. crypto regulation is shifting from disorder to standardization, which is of great significance for the industry’s long-term development. Future focus should be on whether the bill can garner enough support in the full Senate vote and how the specific implementation details will balance innovation incentives with investor protection.