The Long Road to Clarity Passage

Research evidence excerpt

The Long Road to Clarity Passage

loture.4 The resulting Senate version must then

be reconciled with the House version before the Senate and House vote on the final unified bill. Only

then will POTUS have the opportunity to sign the legislation into law. Time is of the essence.

Passage: Mainstream digital assets adoption and the next leg of industry growth. Clarity aims

to harmonize fragmented agency guidances, which may reduce regulatory ambiguity and lower

the legal risks for FIs, specifically banks, exchanges and asset managers, to launch, expand or

commercialize blockchain-based products and services.5 We remind investors that the majority

of TradFi tokenization initiatives include blockchain-native partnerships and blockchains for

settlement, driving beneficiaries across early-moving incumbents and the digital asset ecosystem.

Clarity passage may also reaccelerate the IPO pipeline of private Picks & Shovels toward liquidity

events, delivering a new generation of software companies.

Delay: Return to an elevated status quo with renewed regulatory risk.6 Guidances from the SEC,

CFTC and OCC move the needle, but are not replacements for legislation, given the potential for

rollbacks from a future, less supportive, administration. Renewed regulatory ambiguity around

token classifications, SEC/CFTC jurisdiction and illicit finance compliance requirements if Clarity

passage is delayed are unlikely to bring TradFi adoption to a halt or return the industry to the

hostile environment from the Gensler era that stifled innovation and hindered the formation

of a competitive US digital asset industry. However, delay may force highly-regulated financial

institutions to pause tokenization initiatives or restrict future access to permissioned channels as