Bernstein: Clarity Act Rejection to Accelerate SEC and CFTC Regulatory Actions

The U.S. Cryptocurrency Market Structure Act (Clarity Act) failed to pass the Senate, leading to expectations that regulators will accelerate their own rulemaking efforts.

According to a report published by CoinTelegraph on October 16, Bernstein stated that the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) would 'aggressively and quickly' introduce new regulations to make up for time lost in Clarity Act negotiations.

Earlier, the U.S. Senate voted on a cloture motion to begin floor debate on the Clarity Act but rejected it by a 49-50 vote. While this was not a final vote on the bill itself, Bernstein analysts believe that with remaining legislative schedules and disagreements over ethics provisions ahead of November midterm elections, the likelihood of a re-vote before year-end is low.

Bernstein anticipates that regulators will develop rules regarding token classification systems, decentralized finance (DeFi), and other areas. Proposed regulatory actions include innovation exemptions for stock tokenization, expedited approval for perpetual futures based on real-world assets (RWA), and revisions to regulations concerning sports prediction market contracts.

Earlier this July, SEC Chair Gary Gensler had stated that if the Clarity Act fails to pass the Senate, the SEC would be prepared to establish its own cryptocurrency regulations.