CLARITY Act Could Spark Institutional Crypto Surge, Benchmark Reports
The long-awaited CLARITY Act could prove pivotal for the digital asset sector, potentially opening the door to broader institutional adoption, according to Benchmark analyst Mark Palmer.
The proposed legislation aims to establish definitive rules for digital assets in the U.S., clarifying whether certain cryptocurrencies are to be treated as commodities or securities.
In a report published Monday, Palmer noted that regulatory uncertainty has kept traditional financial institutions—including asset managers, banks, and hedge funds—largely on the sidelines, wary of the legal and compliance risks associated with entering the crypto market.
While the current SEC, led by Chairman Paul Atkins, has shown a supportive approach toward digital assets, Palmer warned that absent a codified framework, a future administration less friendly to crypto could easily overturn existing policies, heightening industry uncertainty.
This lack of regulatory clarity has hindered long-term planning for institutions looking to expand into digital assets, the report said. Passage of the CLARITY Act could resolve much of this uncertainty, providing a stable foundation for increased participation.
Benchmark believes that Galaxy Digital and Coinbase, both rated “Buy,” are “exceptionally well positioned” to capitalize on a wave of institutional interest if the act becomes law.
