Crypto markets have lacked conviction, as traders struggle to identify a catalyst strong enough to lift prices from their current lull. Bitcoin has remained in a range around $60,000, while ether is trading around $2,000 and volumes on major exchanges have declined.
The digital asset market is thirsty for a strong catalyst, and JPMorgan says it has identified one: market structure legislation in the United States, called the Clarity Act.
“Although sentiment remains negative in crypto markets, we continue to believe that a possible passage of market structure legislation, most likely mid-year, could serve as a positive catalyst for crypto markets in the second half of the year,” analysts led by Nikolaos Panigirtzoglou said in a report.
While the market faces broader doubts among both retail and institutional participants, regulatory ambiguity has also weighed on sentiment, leaving larger investors cautious about deploying new capital.
Market participants say that without tangible progress on a coherent regulatory framework, marginalized capital is unlikely to return with a vengeance. This is where the Clarity Act would be a decisive catalyst for the digital asset market, according to JPMorgan.
A comprehensive framework defining oversight, token classifications, and foreign exchange obligations would eliminate one of the biggest issues hanging over this asset class: uncertainty. With clearer rules of the game, large asset managers, pension funds and corporate treasuries that have so far remained cautious could gain the confidence and compliance coverage to increase allocations.
That wave of institutional participation, in turn, could deepen liquidity, compress volatility and unlock the development of new products, from structured offerings to broader tokenized assets.
A bill stuck in limbo
In essence, the proposed bill would define the oversight of the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC), classifying tokens as commodities or digital securities.
Analysts at the bank said placing major tokens under the jurisdiction of the CFTC would reduce compliance burdens and legal uncertainty. A “grandfather” clause would allow certain tokens linked to spot exchange-traded funds listed before January 1, 2026, including XRP, solana, litecoin, hedera, dogecoin and chainlink, to be treated as commodities.
The proposal would also allow new projects to raise up to $75 million annually without full SEC registration, subject to disclosure rules. Analysts said the grace period could revive domestic issuance, venture financing and deal activity that has shifted offshore.
However, the main US effort to establish federal rules on cryptocurrencies has stalled in the Senate after months of talks and missed deadlines, leaving the bill in limbo as lawmakers argue over key provisions.
A scheduled Senate Banking Committee markup was postponed to early 2026 after Coinbase (COIN), the largest U.S. cryptocurrency exchange, publicly withdrew its support for the bill, saying the current language could hinder innovation, weaken competition, and restrict features like stablecoin rewards.
Coinbase’s opposition exposed divisions among industry players and lawmakers, even as some analysts and banking voices say the bill’s core goals — clearer SEC/CFTC oversight and defined regulatory pathways — are keeping momentum alive.
Coinbase CEO Brian Armstrong said earlier this month that banking trade groups, rather than individual banks, were largely responsible for the stalled talks over US legislation on crypto market structure.
In a market still heavily driven by sentiment and flows, a decisive regulatory breakthrough could act as a powerful catalyst, the kind that not only stabilizes prices, but potentially drives them sharply higher.
Read more: From Wall Street to Web3: This is the year of cryptocurrency integration, says Silicon Valley Bank
