The US is on the verge of passing landmark cryptography, and if successful, it could have a serious impact by not only unlocking growth but also significantly reducing risk, Asset Manager said in a report Monday.
According to Bitwise, the growth story is simple. The clarity of the regulations will enable major financial institutions such as JPMorgan (JPM), BNY Mellon (BK) and NASDAQ (NDAQ) to fully build crypto, the report said.
This means a path to moving billions of dollars of new investments and trillions of traditional assets into blockchain rails. Your infrastructure is ready. According to Asset Manager, you need a Washington Go-Amead.
This week, the House of Representatives votes for the Clarity Act, the Crypto Market Structure Bill, and the Genius Act, which regulates U.S. term coins.
Yesterday, the Senate Agriculture Committee chief Democrat said the market structure bill needed a significant change.
If these bills pass Congress, “You cannot bring the Genie back into the bottle,” writes Matt Hougan, Bitwise’s chief investment officer.
Hougan writes that deep, assessed shifts are put at risk. Crypto’s reputation is FTX, Terra/Luna, 3AC, celsius, and Mt. It was hit by a collapse that includes Gox. These were not merely failures in the business model. They were a failed surveillance. Without clarifying US regulations, bad actors thrived in the offshore shadows, and investors paid the price.
Stronger laws would not have prevented all scandals, but they would have stopped many, the report said.
Bitwise points out that Crypto’s volatility, and more than 70% of previous drawdowns, keeping the bystanders. These extreme conflicts can be much more frequent, as the law eliminates the wildcard risk of offshore collapse.
And no, the political winds are unlikely to turn around, Bitwise said. The Genius Act passed Senate 68–30 with bipartisan support, including 18 Democrats.
Wall Street hopes that major agencies will deepen their crypto footprint, and political support will only grow. With BlackRock, JPMorgan and millions of Americans invested, Crypto becomes part of the system, too embedded to ignore and too essential to rewind, the report added.
Read more: Bitwise adds spare proof of Bitcoin, ether ETF
