JPMorgan sees a huge opportunity for the digital market as the US crypto market structure bill is expected to be passed around the middle of this year despite the current weak crypto market sentiment.
The bill, known as the CLARITY Act, aims to provide a clear regulatory framework for digital assets, allowing institutional investors and crypto companies to operate with more confidence.
The US House of Representatives has approved the bill, while the Senate is still debating several key issues, including how stablecoin revenues will be regulated and measures to prevent conflicts of interest for government officials.
If passed, the bill is expected to bring various benefits to the crypto market.
It will allow major tokens such as XRP, Solana, Dogecoin and Litecoin to be categorized under the supervision of the CFTC, rather than the SEC, thus facilitating legal compliance.
In addition, new crypto projects will have the opportunity to raise up to $75 million per year without full registration, which could stimulate innovation and support market growth domestically rather than forcing projects to move overseas.
The bill also provides a mechanism for tokens sold as securities to transform into commodities when sufficiently decentralized, opening up broader trading opportunities and allowing institutional investors to use traditional brokers and existing risk frameworks.
In addition, regulations for crypto intermediaries will be clearer, including registration requirements and custody standards, allowing large institutions such as BNY Mellon and State Street to manage digital assets directly.
Tokenization of traditional assets will also gain clarity that they remain subject to existing regulations, paving the way for the development of a more mature token market.
Developers such as miners, validators and software developers will also be exempted from reporting obligations during development as long as they do not hold other people's funds.
Furthermore, the bill clarifies the taxation of daily transactions and staking, thus encouraging the use of crypto in everyday payment activities.
In terms of stablecoins, the bill may reduce their role as investment instruments, focusing attention on token deposits or profitable alternatives from abroad.
JPMorgan remains optimistic about the crypto market for the year and maintains its long-term Bitcoin target at $266,000.
