The failure of the CLARITY Act in the US Senate has not extinguished bullish expectations across the crypto market. BitMine Chairman Tom Lee argued that despite the bill failing to reach the necessary 60 votes in a Senate procedural vote, real user and investor demand remains more important than any single regulation. He said the passage of the CLARITY Act would have created a clearer regulatory framework and given the US Commodity Futures Trading Commission a more explicit role, but its failure will not completely halt sector regulation. Lee pointed to prediction markets as an example of growth continuing in areas with strong demand even amid regulatory uncertainty.
Lee also reiterated his conviction on Ethereum’s institutional role, stating that once financial institutions decide to use a public blockchain, it would not make sense to shift to newer networks with low liquidity and uncertainties around code security, adoption, market makers, or node operators. He said Ethereum is currently the preferred platform for financial institutions and that switching to alternative networks could create unnecessary technical and operational problems.
Bitwise Chief Investment Officer Matt Hougan offered a similar view, backed by market data. He noted that Bitcoin bottomed at about $57,950 on July 1 and climbed above $80,000 by September 4, while Polymarket odds of the CLARITY Act becoming law this year fell from 39% to 18%. According to Hougan, these opposite trends suggest crypto investors were not waiting for Congress to provide regulatory clarity. Wall Street continued moving into the sector: Robinhood launched its own blockchain, Morgan Stanley launched a Solana ETF, and the Depository Trust & Clearing Corporation completed its first batch of tokenized stock settlements. In August, the SEC proposed Regulation Crypto Assets.
Hougan acknowledged that Bitcoin fell after the Senate vote, adding short-term market pressure, but called the setback more of a speed bump than a roadblock. He said: “Crypto spent its first 17 years without core market legislation. Without Clarity, it has managed to go from a fringe idea to a $2.5 trillion asset class that’s reshaped everything from global payments to capital markets.” US-based Bitcoin ETFs returned to net inflows after two days of heavy withdrawals, attracting more than $159 million on Thursday. BlackRock’s IBIT was the only ETF to report a net inflow, while HYPE recorded $4.25 million in inflows. Ethereum ETFs moved in the opposite direction with $39.2 million in net outflows, extending their losing streak to three days.
