Bitwise Warns of Three-Year Deadline for Crypto Adoption Amid Clarity Act Uncertainty
Crypto asset manager Bitwise has issued a cautionary outlook for the digital asset sector as uncertainty around the Clarity Act continues to deepen.
In a Monday blog post, the firm highlighted how the bill’s stalled progress in Congress may mark a turning point that exposes the industry to prolonged regulatory scrutiny.
The warning comes after the Senate Agriculture Committee postponed its cryptocurrency market structure markup hearing—from Monday to Thursday—citing the severe winter storm that hit much of the United States.
Bitwise Highlights Regulatory Vulnerability
Matt Hougan, Bitwise’s Chief Investment Officer, stressed the importance of the Clarity Act in establishing a stable, pro-crypto regulatory environment. Without it, he warned, the industry remains vulnerable to shifting political priorities and the preferences of future administrations.
Market sentiment surrounding the bill has soured sharply.
Contract asking if CLARITY Act will be signed into law in 2026 (Source: Polymarket)
Polymarket traders once priced an 80% chance of passage in early January, but odds have dropped to around 55% after concerns raised by industry leaders—most notably Coinbase CEO Brian Armstrong, who withdrew support after identifying provisions he said could harm consumers and suppress competition.
A Three-Year Window for Crypto to Prove Itself
With the bill’s fate uncertain, Hougan argued that the industry must push forward in the spirit of disruptive platforms like Uber and Airbnb, which cemented their success by becoming too popular and useful to ignore. He suggested crypto has roughly three years to achieve the same level of indispensability across the U.S. economy.
If cryptocurrencies and tokenized assets reach that threshold, he said, a sweeping repricing of the sector could spark a major bull market. If not, the market may enter a “wait and see” phase—where price growth stagnates under regulatory hesitation and only clear real-world adoption can break the stalemate.
Implications for Investors and Market Positioning
Bitwise remains hopeful that the current administration will maintain its pro-crypto stance. Still, the firm warned investors to be prepared for a slower growth trajectory if legislative ambiguity persists.
Research from Wall Street broker Benchmark echoes that sentiment, arguing that failure to pass the Clarity Act would delay—but not derail—crypto’s long-term maturation, leaving the U.S. market below its full potential.
In such an environment, Bitwise recommends focusing on Bitcoin-centric assets, companies with strong balance sheets, and cash-flowing infrastructure, rather than regulatory-sensitive sectors such as exchanges, DeFi, and altcoins.
