The U.S. cryptocurrency industry is entering what one of its leading lobbyists describes as a decisive moment.
During her Friday appearance on Fox Business, Kristin Smith, president of Solana Policy Institute, said the coming days could determine whether the industry finally secures a comprehensive federal regulatory framework after years of uncertainty.
“We’ve come so far with this legislation since the House passed the Clarity Act a year ago,” Smith said. “There has been a lot of bipartisan input into this bill, and it is the best, most comprehensive language we’ve seen.”
However, despite her optimism, betting markets have become increasingly skeptical that the legislation will cross the finish line this year.
Ethics negotiations become central obstacle
Ethics negotiations have stalled the passage of the much-talked-about bill, and Smith claims that the crypto industry itself cannot dictate the outcome.
“It is absolutely essential,” she said. “It’s one of those tricky issues where it’s not the crypto industry’s place to decide what the deal is.”
According to Smith, discussions with Democratic lawmakers have made it clear that they will insist on the addition of “ethics language.”
“I have met with members of Congress, especially Democrats. They need to have some sort of ethics language to be able to vote for it,” she said.
The proposed provisions would establish conflict-of-interest rules governing elected officials’ involvement with crypto businesses.
Smith believes a compromise remains achievable. “This is a president who knows the art of the deal. If we get the president and the Democrats to agree on this issue, that will break the logjam, and we will be able to get the votes needed to get this through the Senate sometime next week or the following,” she added.
The most significant crypto legislation
Smith described the legislation as the most significant crypto reform effort to date. If enacted, Smith argues, the legislation would dramatically improve investor protections while accelerating institutional adoption.
“Once we get this passed, we are going to see an unleashing of economic activity around the crypto space,” she said.
She predicted the bill would lead to an upgrade to the financial services system, more traditional institutions adopting crypto technology and integrating it into their services.
Betting markets turn increasingly pessimistic
Despite the industry’s public optimism, prediction markets have actually become more pessimistic.
According to Kalshi, the probability that U.S. crypto market structure legislation becomes law before Jan. 1, 2027, has fallen to roughly 36%.
There is still some hope. The House Financial Services Committee will hold an informational field hearing in New York examining how the Clarity Act could foster innovation. Updated legislative text remains rather elusive so far, according to recent reports.
