- Bitwise’s Chief Investment Officer (CIO) showed his support for the SEC issuing crypto rules as Congress delays the CLARITY Act.
- The bill is now facing the August 5 deadline before the Senate leaves for the August recess.
Bitwise CIO Matt Hougan recently made remarks on the CLARITY Act. He stated that the crypto industry will continue expanding even if Congress fails to pass the bill.
This comes after the CLARITY Act was delayed by more than a year. The bill had already passed the House of Representatives the previous year.
Hougan pointed to Atkins’ statement that if Congress fails to pass the bill, the SEC will write the Crypto rules themselves. He added that the SEC’s crypto rules are “likely to be more crypto- and innovation-friendly than those that would emerge from a bipartisan bill in Congress.”
Matt Hougan’s Remarks on Progress and Failure of The CLARITY Act
In a blog post on August 4, Bitwise CIO Matt Hougan described the status of the CLARITY bill. He also explained the potential impact on the industry.
According to him, passing the bill would enhance the U.S. economy by strengthening ethical provisions and investor safeguards.
The bill will provide the United States with a more protected on-chain finance system in the crypto sector.
However, failing to pass would not do much harm to the progress of the crypto industry. The financial sector has already moved much further with blockchain and digital assets.
Hougan described that if the bill stalls, it will enter a “walking dead” state. He further added that “nothing can actually kill it, but it will lurch along.”
The bill has been under uncertainty for the past few months. Hougan described this week as “make or break” for the Clarity Act, as the Senate will soon break for the August recess.
The chances of the crypto regulation bill passing could get much lower. This may happen if the Senate fails to hold the vote before the recess. As the recess ends on September 14, lawmakers may shift their focus towards the November election and legislation.
SEC to Drive Crypto Regulation Even Without the CLARITY Act
Bitwise’s CIO has pointed to the SEC’s ability to issue better rules than those coming from “a bipartisan bill in Congress.” He mentioned the recent statements of the SEC’s Chairman, Paul Atkins, on crypto regulations.
Atkins has broadly claimed that the SEC is “ready, willing, and able to come out with rules that address the same issues [as] Clarity.”
In March, the SEC and CFTC jointly released guidance on regulating securities and commodities. Later, the SEC also outlined clear rules on tokenized securities and on-chain trading.
These developments have evoked confidence among investors and raised issues. However, the risk falls around the future administration that can reverse the process. “Crypto will have at least two and a half years” if the process continues to be delayed.
How the Delay Affects Institutional Crypto Adoption
Hougan has warned that delays in the bill’s passage can affect institutional participation and crypto adoption. He stated that “uncertainty around Clarity is keeping some professional investors on the sidelines of crypto markets.”
Major Banks and institutional participants require a legislative definition of securities and commodities. They wait for the official text to launch their crypto custody and trading products to mitigate risk factors.
As per Polymarket, the odds of passing the CLARITY Act in 2026 now stand at 27%. This reduces confidence, as the chances of the bill passing this year are lower.
