Crypto Momentum Gains Momentum in Washington Ahead of Summer 2028 Deadline

The crypto industry is gaining momentum in Washington, despite the Clarity Act's failure. Kristin Smith, president of the Solana Policy Institute, argues that rules implemented before summer 2028 will be more durable due to the Congressional Review Act. The industry has already won several key regulatory victories, including the Genius Act and a change to the IRS broker rule.

However, challenges such as the president's family crypto business and banks' lack of full onboarding remain to be addressed. Smith believes that traditional finance and overseas firms will build on finished rules, making them harder to undo. In contrast, Bitwise Chief Investment Officer Matt Hougan concedes that crypto's regulatory future depends on agencies and a new administration could reverse their rules from January 2029.

Key Takeaways

• The Clarity Act's failure does not necessarily mean the industry has lost momentum.
• Rules implemented before summer 2028 will be more durable due to the Congressional Review Act.
• The industry has already won several key regulatory victories, including the Genius Act and a change to the IRS broker rule.

What's Next

• The CFTC is currently open to public comment on leveraged retail crypto trading rules.
• The SEC and CFTC rulemaking processes can take 18 to 24 months.
• Smith believes that traditional finance and overseas firms will build on finished rules, making them harder to undo.

Challenges Ahead

• The president's family crypto business remains a challenge to be addressed.
• Banks' lack of full onboarding is another hurdle to overcome.

Regulatory Outlook

• The Congressional Review Act gives Congress the power to overturn recent agency rules.
• Smith believes that rules completed before the window, around summer 2028, will be more durable.
• A new administration could reverse rules from January 2029.

Industry Outlook

• The industry is optimistic about its progress in Washington.
• Smith argues that crypto's regulatory future depends on agencies and the timing of rule implementation.