CLARITY Act Passage Odds Drop to 31%, Triggering Crypto Sell-Off Fears

Bernstein warns that the declining likelihood of the CLARITY Act passing could spark a short-term market sell-off, pressuring Bitcoin valuations, while regulatory acceleration remains a medium-term possibility.

Woofun AI reports that investment firm Bernstein stated the prospects for the U.S. CLARITY Act are diminishing, noting that Senate inaction before the recess may trigger a short-term negative market reaction and pressure Bitcoin valuations. The firm indicated that while a bill failure could cause an "instinctive sell-off," it might also compel the SEC and CFTC to accelerate regulatory actions, including clarifying token classification and developing DeFi frameworks.

Woofun AI data shows that Polymarket odds for the bill passing this year have fallen to 31%, down 7 percentage points from last week and 9 from the past month, with $3.7 million in betting volume. Bernstein expects the crypto market to bottom out between late Q3 and early Q4, potentially regaining momentum before the U.S. midterm elections, as the Act faces opposition from the banking sector over stablecoin yield provisions.