Bernstein: Progress on the CLARITY Act May Exceed Market Expectations, Democratic Lawmakers Also Wary of the "Anti-Crypto" Label Ahead of Midterm Elections

BlockBeats news, September 15: Wall Street investment bank Bernstein stated that the latest negotiations in the U.S. Senate surrounding the CLARITY Act may be stronger than the market previously expected. The firm believes the market still leaned bearish before the procedural vote on September 15 local U.S. time, and any positive outcome has not yet been fully reflected in crypto asset and crypto stock prices.

The Bernstein team noted that the latest draft released by Senate Republicans incorporated 126 substantive amendments proposed by Democrats, covering officials' crypto asset conflicts of interest, the enforcement role of state attorneys general, stablecoin reward mechanisms, and protections against community bank deposit outflows. The Treasury Secretary would also receive a stablecoin reward "circuit breaker" power lasting up to 18 months.

Bernstein believes the White House's concessions on ethics provisions are nearing the upper limit of negotiable space, and some Democratic lawmakers will also be wary of the "anti-crypto" label before the midterm elections. Prediction markets have rebounded above 30% for the probability of the bill advancing within the year, indicating that policy expectations are beginning to recover.

However, Tuesday's vote is still only a procedural step to decide whether to begin debate, requiring 60 votes in support, and does not mean the bill has already passed or will take effect immediately. Even if the procedural motion passes, subsequent stages will still include amendments, a final vote, and House coordination.

Bernstein warned that if the bill is blocked and combined with a hawkish Federal Reserve decision, the crypto market could see a relatively large drawdown; conversely, better-than-expected legislative progress would become a short-term catalyst for native crypto assets and crypto stocks.