The bank warns that the bill encounters significant obstacles, with successful passage likely to enhance institutional crypto adoption while delays may extend regulatory ambiguity.
By Will Canny, AI Boost|Edited by Nikhilesh De Jun 30, 2026, 2:41 p.m. 3 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on Jefferies highlights potential crypto market fluctuations as Clarity Act faces Senate challenges. (Shutterstock)SummaryShow- Jefferies noted that the Clarity Act is facing a challenging road in the Senate, with diminishing legislative time and unresolved political issues.
- Successful passage could propel institutional digital asset adoption, while delays would extend regulatory uncertainty.
- The bank anticipates increased volatility in crypto tokens and blockchain-related stocks as the bill's fate becomes clearer.
Despite advancing through the Senate Banking Committee, the Clarity Act still encounters significant challenges, with Jefferies cautioning that political instability may lead to fluctuations in the crypto market in the near future.
The bill passed the committee with bipartisan support, receiving a 15-9 vote earlier this year, but Jefferies warns of tougher obstacles ahead. According to Polymarket, the chances of the bill passing by the end of 2026 have dropped to 48%, down from 70% in mid-May, due to concerns regarding ethics provisions, illicit finance, and limited time available in the Senate.
Lawmakers have approximately 20 legislative days before the August recess to reconcile competing Senate versions, clear procedural votes, align the measure with the House bill, and send it to President Donald Trump.
"If the Clarity Act does not pass before the August recess, it may be delayed until next year or later, especially if Democrats regain control of the Senate in November," the analysts led by Andrew Moss stated in a Tuesday report.
The Clarity Act is considered a crucial market structure bill for the crypto industry, as it would provide definitive guidelines on when digital assets are classified as securities by the Securities and Exchange Commission (SEC) or as commodities by the Commodity Futures Trading Commission (CFTC), thereby resolving years of regulatory ambiguity.
Proponents argue that establishing legal clarity would facilitate banks, asset managers, and other institutions in launching tokenized products, custody services, and blockchain-based financial offerings, potentially paving the way for broader institutional investment and adoption in the sector.
Jefferies believes that if passed, the bill would deliver a stable regulatory environment that banks, asset managers, and exchanges require to enhance tokenization, custody, staking, lending, and other blockchain services. The bank also predicts it would speed up the development of tokenized securities, expand crypto exchange-traded funds (ETFs) beyond just bitcoin BTC$58,554.42 and ether (ETH), and rejuvenate the pipeline for crypto infrastructure IPOs.
Conversely, a delay would prolong regulatory uncertainty. While recent guidance from the SEC, CFTC, and OCC has improved the outlook, Jefferies noted that agency actions could be reversed by future administrations, which might cause regulated financial institutions to pause blockchain initiatives while they reassess legal and compliance risks.
The bank's analysts expect the legislative process to induce fluctuations in crypto-related equities, such as Circle (CRCL), Coinbase (COIN), and CoinDesk's parent company Bullish (BLSH), along with select crypto tokens.
For Circle, the bank anticipates mixed outcomes. The current legislation could close a loophole that allows third parties like Coinbase to offer rewards on USDC holdings, potentially hindering USDC's growth. However, a delay would afford Circle additional time to broaden its payments network and diversify revenue beyond stablecoin reserve income.
In the long run, Circle's greatest threat may arise from escalating competition rather than from legislation, as banks, fintechs, and payment firms introduce rival stablecoins with more extensive distribution networks, the report suggested.
Earlier this month, JPMorgan (JPM) indicated in a report that the proposed U.S. crypto market structure bill might have a limited opportunity for passage this year, given the tightening congressional calendar ahead of the midterm elections and unresolved discussions surrounding stablecoin yields.
Read more: JPMorgan warns time is running short for crypto market structure bill
RegulationClarity ActAI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.Related AssetsBitcoin$58,554.421.37%Latest Crypto News- 1Circle slides 8% as Stripe, Coinbase and BlackRock back rival stablecoin network27 minutes ago
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