Bitcoin has staged an impressive recovery over the past week, surging more than 20% and briefly climbing back above the $80,000 mark. However, amid the broader cryptocurrency market euphoria, traders on the prediction platform Kalshi are pouring cold water on the rally, assigning less than a 25% probability to the Digital Asset Market Clarity Act (CLARITY Act) being signed into law by the end of the year. The odds of the legislation being enacted before April 2027 also sit below 50%.
The CLARITY Act aims to establish a clear regulatory framework for digital assets, delineating the jurisdictional boundaries between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). Currently, the SEC oversees securities while the CFTC regulates derivatives, including futures and prediction markets. Although both agencies have issued guidance related to crypto assets, a definitive division of authority remains unresolved. The bill passed the House with bipartisan support in July 2025 and is scheduled for a procedural vote in the Senate on September 15.
Pressure is mounting from the White House, with President Donald Trump publicly urging Congress last week to pass "a fair version of the CLARITY Act." Bitcoin climbed to $80,908 on Tuesday, marking its first return to the $80,000 threshold since May 15. The core catalyst behind this latest move stems from a macroeconomic shift: the U.S. Treasury announced an expansion of its long-dated bond buyback program last week, which pressured long-end yields and weighed on the dollar, reigniting the "devaluation trade" narrative.
In tandem, Trump's meeting with executives from the SEC, CFTC, and several major crypto firms has fueled optimism that a clearer U.S. crypto regulatory framework is on the horizon, prompting a significant repair in market sentiment. Institutional capital inflows and short covering have further amplified the gains. Yet, in stark contrast to the market's fervor, Kalshi traders see a relatively low likelihood of the CLARITY Act passing this year, though the probability of passage before July next year is close to 60%.
SEC Chairman Paul Atkins and CFTC Chairman Michael Selig attended last week's meeting between Trump and cryptocurrency industry leaders. During the session, Selig indicated that if the CLARITY Act fails to clear the Senate, the agency would act on its own. "If the CLARITY Act continues to stall due to Democratic obstruction, the CFTC will use its existing authority to begin establishing a regulatory regime for the crypto asset market," he said. "We have a responsibility to do this for the American people." Currently, bitcoin is trading at approximately $79,000.