 ▲ Cryptocurrency © |
A sweeping regulatory shift set to dramatically reverse the virtual asset market, currently gripped by extreme fear, is coming this summer. Once two key bills that will provide clear guidelines take effect and are passed, the floodgates of tightly shut institutional capital are expected to open, triggering an explosive rally led by Bitcoin (BTC) and Ethereum (ETH).
According to investment outlet The Motley Fool on February 17 (local time), while the virtual asset market appears to be in an endless decline, a powerful catalyst in the form of new market regulatory legislation capable of turning sentiment around sooner than expected is imminent. The two major bills, expected to gain momentum as early as this summer, are anticipated to lay down a safe and robust official highway for highly risk-averse institutional investors to enter the crypto market.
The first is the stablecoin regulatory law GENIUS. Officially signed last July, the bill will finally enter full implementation this summer, providing comprehensive rules covering the entire stablecoin ecosystem, including reserve requirements, external audits, and issuer oversight. This is expected to serve as a key driver behind a tsunami of new capital flowing into the crypto sector by encouraging major technology and financial firms to issue their own stablecoins.
The second is the U.S. cryptocurrency market structure bill, the CLARITY Act, which was originally scheduled for processing last year but was delayed due to the federal government shutdown and market downturn. While there were concerns that bipartisan support in Washington was wavering, strong backing from key administration officials, including Treasury Secretary Scott Bessent, has increased the likelihood of final approval as early as July.
The core of the CLARITY Act is the transfer of a significant portion of regulatory oversight authority from the U.S. Securities and Exchange Commission (SEC) to the more crypto-friendly Commodity Futures Trading Commission (CFTC). This shift would provide Wall Street financial giants with greater clarity and reduced regulatory risk, establishing a firm foundation for launching a variety of new financial products, including exchange-traded funds (ETFs) linked to digital assets.
The outlet identified Bitcoin and Ethereum—overwhelming favorites among institutional investors—as well as stablecoins and real-world asset (RWA) tokenization-related assets as the biggest beneficiaries of the new safe zone. Although the Crypto Fear & Greed Index has plunged to 8, reflecting extreme panic in the market, it assessed that the current extreme pessimism is greatly exaggerated as the once lawless ecosystem is set to transform into a clear and transparent environment.
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