U.S. Senate Banking Committee Votes in Favor of Clarity Act

Today’s newsletter goes out a bit later than usual because I was waiting on the news of the Crypto Market Structure Bill, which has now passed the Senate Banking Committee with a 15-9 vote. There’s also more movement on the tokenization front on Wall Street.

TL;DR

• The Senate Banking Committee passed the Digital Asset Market Clarity Act by a 15-9 vote, marking another step forward for crypto regulation in the US.  

• BlackRock and JPMorgan are the latest Wall Street firms to launch new tokenized products. 

Senate Banking Committee Passes Digital Asset Market Clarity Act With a 15-9 Vote 💪

It was just over a week ago that I wrote about the Digital Asset Market Clarity Act, or the Crypto Market Structure Bill, as most people call it, and how the digital asset industry reached a compromise. 

This week, we have a very bullish update!

The Senate Banking Committee held an important vote on the Bill on Thursday and passed it with a 15-9 vote. 

The approval was a boost for Bitcoin and other digital asset-related public companies, such as Coinbase. BTC jumped 3% on the news and Coinbase’s stock rallied 8%. Other crypto equities followed the same trend. 

The rally isn’t surprising given that the Clarity Act is arguably the most comprehensive crypto market-structure legislation Capitol Hill has voted on to date.

The bill aims to clarify how digital assets are classified and regulated, including which agencies oversee different parts of the market.

Regulatory clarity in the US is taking even more shape, and the institutional capital that's been waiting on the sidelines just got another strong signal from lawmakers. 

So, what are the next steps then? 

The Banking Committee version still has to be reconciled with the companion bill that cleared Senate Agriculture in January before anything reaches the floor. That means we still need to wait a bit for a final merger of the latest version of the bill with the already voted-on changes. 

Once that process is complete, the bill can move toward a full Senate vote.

But there is crucial information about this upcoming vote: the 60-vote threshold. With Republicans holding 53 Senate seats, the bill would still likely need Democratic support to clear the 60-vote threshold.

Considering that Senate Democrats are currently doubling down on what they call “ethical crypto exposure,” demanding transparency from representatives about their market investments, it could still be an uphill battle till we get there.

However, we've managed to get the bill to this stage, and with the industry-wide push from Coinbase and others, I’m pretty confident the bill will go through.

The Wall Street Tokenization Race Accelerates 🚀

My start in digital assets was because of tokenization. So to me, it was always clear that one day, a large part of the financial system would eventually tokenize its products.

While I realized this over a decade ago, it took Wall Street institutions a bit longer to reach the same conclusion. 

However, as we saw this week, they are taking big steps in that direction now.

JPMorgan and BlackRock both announced tokenized products this week. The recent regulatory momentum around stablecoins and tokenized assets, including the GENIUS Act, is helping accelerate these initiatives.

Jamie Dimon’s bank is launching a U.S. Treasury money-market fund on Ethereum, and Larry Fink’s asset manager is going after money-market funds, with two new tokenized funds announced earlier this month. 

This, by the way, isn’t the first tokenized product from BlackRock. They previously tokenized and launched their USD Institutional Digital Liquidity Fund (BUIDL) in 2024. 

JPMorgan’s new fund, the JPMorgan OnChain Liquidity-Token Money Market Fund, is designed to meet reserve requirements for stablecoin issuers under the GENIUS Act.

Oh, and while they didn’t launch a tokenized service, Charles Schwab was also in the news this week with their official launch of spot crypto trading for retail clients. 

While the price of Bitcoin may still be trading below last year’s highs, there’s plenty of positive industry news that suggests the fundamentals for Bitcoin have arguably never looked better. So, let’s see how that will translate into price action throughout the rest of the year.

Elsewhere in Bitcoin 📖

A quick look at what else has been happening in Bitcoin: 

• Kevin Warsh is confirmed as the next Fed Chair 

• Revolut briefly showed a Bitcoin price of $0.02 last week 

• Someone recovered their Bitcoin wallet from 2013 with Claude

• Strategy may sell BTC in the future to cover dividends and increase BTC per share

• Fidelity releases a BTC research report on how it’s a hedge against monetary inflation

Your fellow stacker in sats, 

Patrick Lowry

PS: If you want to see how the value of goods and services changes when priced in Bitcoin, check out the Samara Bitcoin CPI. It might give you a new perspective on holding Bitcoin on your company’s balance sheet or just as an individual.

Disclaimer: The opinions expressed in this newsletter are solely those of the author and do not necessarily represent the views of any associated company. This newsletter is for educational and informational purposes only and should not be construed as investment, financial, or any other professional advice. Nothing here is a solicitation, offer, or recommendation to buy or sell any asset or to use any service. Investing in cryptocurrencies is highly speculative and carries a significant risk of substantial financial loss, so you must conduct your own thorough research and consult with independent professional advisors before making any decisions.