Bitwise Chief Investment Officer Matt Hougan now argues that the Senate’s failure to advance the CLARITY Act is unlikely to halt the cryptocurrency rally that began in early July. In a September 16 memo, he recast the legislative setback as a temporary obstacle rather than a cycle-ending event.
On September 15 the Senate rejected cloture on the Digital Asset Market Clarity Act by a 49-50 vote, short of the 60 votes needed to proceed.
Every Democrat opposed the measure, along with several Republicans.
Hougan called the outcome unfortunate, describing the bill as a constructive framework that would have improved investor safeguards and created durable rules extending beyond the current administration.
Earlier in the year he had likened the legislation to crypto’s version of Punxsutawney Phil, warning that defeat could bring several more weeks of difficult trading conditions lasting toward the midterms.
After reviewing recent market behavior, he abandoned that forecast.
The data, he wrote, suggest the bill’s fate matters less than headlines imply.
The rally he referenced started July 1, when bitcoin found a low near $57,950.
By September 4 the asset had climbed above $80,000.
Over that same window, prediction-market odds that CLARITY would become law in 2026 dropped from 39 percent to 18 percent.
If the advance had depended on congressional passage, declining probabilities should have produced falling prices.
The opposite occurred.Hougan attributed part of the divergence to institutions that refused to wait for lawmakers.
In recent months Robinhood launched its own blockchain, Morgan Stanley introduced a Solana exchange-traded product, and the Depository Trust & Clearing Corporation completed production settlements of tokenized securities.
Those firms, he said, already possessed “clarity of conviction” because a crypto-friendly Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) remain in place through 2029.
SEC Chair Paul Atkins has stated the agency is prepared to issue rules covering many of the same topics as the stalled bill; the commission already proposed a Regulation Crypto Assets package in August.
CFTC Chair Mike Selig has similarly indicated his agency is ready to publish its own framework quickly.
Hougan believes those forthcoming rules could prove more innovation-friendly in the near term than a compromise statute, even though agency actions can later be reversed and only Congress can grant the CFTC full authority over spot markets.
He acknowledged the immediate market reaction was negative: bitcoin declined roughly 4 percent the day after the vote, a move he viewed as understandable given concurrent concerns about interest rates and energy prices.
Passage would have made digital assets the consensus fourth-quarter trade and almost certainly driven prices higher.
Absent that catalyst, additional bumps remain.
Yet the destination, in his view, is unchanged.
Cryptocurrency operated for seventeen years without comprehensive market-structure legislation and still grew into a $2.5 trillion asset class that has altered payments and capital markets while attracting hundreds of millions of users and the world’s largest financial institutions. Hougan expects observers will later conclude that the industry simply continues to build.