If the CLARITY Act passes... Is now the right time to invest in cryptocurrency?

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As the possibility of the 'rules' of the US cryptocurrency market changing increases, both expectations and caution surrounding investment timing are growing.

According to cryptocurrency media Watcher.Guru on May 5 (local time), the US Congress is on the verge of passing the CLARITY Act, a bill concerning the structure of the US cryptocurrency market. The core of this bill is to clarify the legal classification of cryptocurrency assets and the investor protection system.

The biggest confusion in the current market is the lack of criteria for determining which assets are securities and which are commodities. Accordingly, the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have jointly classified major assets such as Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) as digital commodities. The CLARITY Act is highly likely to further specify these criteria.

Regulations for memecoins are also included. According to an announcement in March, memecoins are classified as 'digital collectibles' and are excluded from securities regulations. At the same time, the bill plans to introduce investor protection measures such as strengthening transparency, mandating risk disclosure, and establishing a market surveillance system.

The market expects that if this bill passes, it could lead to increased institutional capital inflow and a restoration of trust across the industry. Analysis suggests that if regulatory uncertainty is resolved, there is a greater possibility for cryptocurrencies to be integrated into mainstream financial assets, and individual investor participation could also expand.

However, high volatility and structural risks still remain variables. As rapid price fluctuations and systemic risks have repeatedly occurred, such as in the Terra-Luna incident and the FTX collapse, there are continued warnings that even with regulatory clarity, a cautious approach to investment is necessary.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*