Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Significant institutional capital is being hindered from entering the cryptocurrency sector by the delay in passing the Clarity Act, according to White House crypto policy adviser Patrick Witt. "There are trillions of dollars in institutional capital on the sidelines waiting to get into [the cryptocurrency] space," Witt said on Feb. 13 on X, sharing a Yahoo Finance interview where he discussed the Clarity Act. "Regulation is the unlock." The Clarity Act is the proposed cryptocurrency market structure legislation currently stuck in the Senate. The House passed a version of the bill last July, but the Senate’s version has faced delays amid debates over stablecoin yield.
• Build your own AI-powered index in minutes — and earn an uncapped 1% match when you move your portfolio to Public. Learn how it works. The Senate’s version of the bill prohibits cryptocurrency service providers from issuing rewards on idle stablecoin holdings. The banking industry has warned of potential of deposit flight from community banks, while the cryptocurrency industry says that banks are trying to use legislation to stamp out competition. The stalemate has led to two White House meetings involving each side, and Witt told Yahoo Finance that there could be more. "It’s unfortunate that this has become such a big issue, because ultimately, this is not the stablecoin bill," he said. "That was the GENIUS Act. But we’ve heard from Senators on both sides of the aisle concerns about potential deposit flight from stablecoins on different platforms. And so what we’ve encouraged both sides to do is, let’s find a middle ground." Trending: This ETF issuer isn't chasing the index — it's building tools for income, leverage, and conviction Witt said it is imperative that the bill not be derailed, claiming benefits for traditional financial institutions and the cryptocurrency industry. He said it would provide clarity for institutions looking to experiment with blockchain rails and developers building in the space. He also said it would prevent an administration hostile to the cryptocurrency industry from eroding the goodwill the cryptocurrency industry has enjoyed under President Donald Trump. The window of opportunity is fast closing, Witt told Yahoo Finance, while still expressing hope that the bill could be passed before preparations for the midterm elections enter into full swing.