Grayscale's Zach Pandl discusses crypto growth without CLARITY Act

Zach Pandl, Head of Research at Grayscale, suggests that the U.S. cryptocurrency industry can continue to expand even if the CLARITY Act is not passed into law by 2026. He notes that much of the ecosystem has operated for nearly 17 years without extensive market-structure legislation, with Bitcoin serving as a store of value and stablecoins functioning as payment methods.

While the failure of the Act might not have an immediate market impact, Pandl warns that the lack of a clear regulatory framework could hinder domestic innovation. Without comprehensive rules, investors and businesses may face uncertainty regarding securities laws and tokenized assets, potentially driving new investment overseas. Pandl expects that SEC rulemaking and other regulatory actions may help fill this gap.

Currently, Polymarket odds for the CLARITY Act's approval in 2026 have dropped to 21%. Patrick Witt, Executive Director of the President’s Council of Advisors for Digital Assets, has argued that legislative delays are increasingly becoming a political issue, noting that even pro-crypto Democrats have requested more negotiation time.