CLARITY Act Could Unlock Trillions for Crypto, Experts Say

The core argument from analysts like 360Trader is that an unprecedented amount of institutional capital remains on the sidelines, awaiting a definitive legal framework before entering the digital asset space. In a recent social media post, the expert cited White House Digital Asset adviser Patrick Witt, who confirmed that “trillions in institutional capital are effectively sidelined as firms wait for legal clarity.” This sentiment underscores a widespread view that major financial institutions, including asset management behemoth BlackRock, are constrained by the current patchwork of U.S. regulations.

The proposed CLARITY Act is seen as the potential trigger to resolve this impasse. Experts believe its passage could act as a watershed moment, similar to the rally that followed the approval of spot Bitcoin ETFs in 2024, but on a much larger scale. 360Trader’s assessment suggests that the bill could “open Wall Street’s doors to crypto in a meaningful way,” potentially driving more than $5 trillion into the sector over time and pushing the total crypto market capitalization beyond the $4 trillion mark.

A pivotal component of the CLARITY Act is its provision to grant banks clearer authorization to issue stablecoins. This comes as the stablecoin market has already achieved staggering scale, with a reported supply of $300 billion in 2025 and processing approximately $33 trillion in annual transaction volume—a figure that notably exceeds the total throughput of the Visa network. This existing infrastructure highlights the massive demand for digital dollar equivalents.

The prospect of major traditional financial institutions like JPMorgan launching fully integrated, bank-issued stablecoins backed by substantial payment activity is described as a potential turning point for the entire sector. Such a development would deeply embed crypto-native instruments within the traditional financial system, enabling faster settlement and more efficient transaction rails by potentially integrating decentralized finance (DeFi) infrastructure.

However, this integration faces resistance. The traditional banking sector has consistently pushed back against the yield structures offered by some stablecoin products, citing concerns about the impact on their deposit bases. This tension is a key factor in the current legislative delays and the subject of ongoing White House meetings, as banks seek to protect their core funding sources from a more competitive landscape.

Beyond market structure, a powerful financial incentive is poised to accelerate capital flows. A significant yield disparity exists between crypto-linked instruments and traditional banking products. Some stablecoin-based products currently offer returns in the range of 3% to 5%, a stark contrast to the average traditional savings account yield of roughly 0.07%.

This disparity, experts argue, could prompt a historic reallocation of capital from conventional bank deposits into higher-yielding crypto instruments. 360Trader suggested this shift could involve “potentially as much as $6 trillion” moving from the traditional system. This would not only involve retail investors but could also pave the way for broader exposure by pension funds and university endowments seeking enhanced returns in a regulated environment.

In the expert’s own words, this convergence of regulatory clarity and financial incentive creates a unique catalyst: “I’m bullish on CLARITY unlocking trillions in dormant capital. This could be the catalyst that separates the next bull run from everything we’ve seen before.” While final passage in Congress remains uncertain, the analysis posits that the bill represents more than just regulation—it is viewed as the potential ignition switch for the next epoch of digital asset growth, fundamentally bridging the worlds of crypto and traditional finance.