Ron Hammond, the head of policy at Wintermute, a prominent crypto market maker, has expressed a cautious outlook regarding the prospects of the Crypto Clarity Act, estimating its chances of passage in 2026 at approximately 30%. This assessment comes amidst a complex legislative process, with the bill aiming to establish clear regulations for crypto market structure in the US, including the oversight of digital assets by the Securities and Exchange Commission and the Commodity Futures Trading Commission. Hammond's prediction is broadly in line with other market signals, including a recent Punchbowl survey and the prediction market Kalshi, which have also indicated a low probability of the bill's passage.
Despite the uncertainty, Hammond notes incremental progress, with lawmakers pushing for the bill to move through committee, potentially leading to a vote as early as April 20. However, he cautions that timelines have been fluid and subject to change.
The passage of the Crypto Clarity Act is seen as crucial for institutional adoption of crypto, as it would provide clear guidelines on which digital assets are considered securities versus commodities and how they can be traded and regulated in the US. The current fragmented regulatory framework has deterred many large asset managers, banks, and pension funds from entering the crypto market due to legal and compliance risks. A comprehensive market structure law would reduce this ambiguity, enabling institutions to confidently scale their exposure to crypto and integrate it into traditional financial systems. However, significant hurdles remain, particularly from traditional financial institutions, which are opposed to the idea of stablecoins offering yield.
According to Hammond, negotiations between various parties, including Coinbase, the White House, and the bill's drafters, have been unsuccessful in finding a solution that satisfies both sides. The dispute has already led to the failure of at least one proposed compromise, and expectations for a new version are tempered. The resistance from banks is shaping the politics around the bill, especially for Democrats, who are navigating a difficult balancing act due to their acceptance of crypto industry funding.
Additional political headwinds may emerge in the coming months, particularly if scrutiny around former President Donald Trump's crypto-related dealings intensifies. Despite these challenges, Hammond believes the bill still has a viable path forward, with progress in committee and continued negotiations potentially keeping it alive into mid-year, when political incentives may shift.
For Wintermute, which is expanding its US footprint and growing its New York team, the outcome of the Crypto Clarity Act is highly consequential. Hammond's estimate of a 30% chance of passage serves as a reminder that progress in Washington does not always translate into tangible results.