JPMorgan Says Agency Crypto Rules Can Be Overturned in Court. Is Losing the CLARITY Act Worse Than It Looks?

The Senate's failure to pass the CLARITY Act sent crypto leaders rushing toward a familiar backup plan, but JPMorgan just warned that fallback may be far more fragile than the industry wants to admit.

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On September 15, the U.S. Senate blocked the cloture motion to advance the CLARITY Act bill, failing by 49-50 votes. In the hours and days that followed, some of the industry’s biggest names, including Atkins, Selig, Armstrong, Saylor and Garlinghouse, pointed to the same fallback. If Congress could not deliver new rules, they argued, the agencies could still provide a clearer path through rulemaking.

However, one of the top global financial services firms, JPMorgan, was less convinced. The bank told clients that a soft landing built on agency rules is not the same as one backed by legislation because rules can be changed or reversed more easily. JPMorgan still recognized that clearer agency rules could support crypto prices, but questioned how durable that clarity would be without Congress putting it into law.

What JPMorgan Said and What Bernstein Conceded