If Congress fails to pass market structure legislation this year, the US crypto market would not return to the enforcement-heavy environment of 2022 and 2023, but it would remain structurally constrained at a time when global adoption and institutional interest are accelerating, Wall Street brokerage Benchmark said.
“The absence of legislation will see a structural risk premium persist across large parts of the digital asset ecosystem,” analyst Mark Palmer wrote in Monday’s report, adding that this would limit valuation expansion for US-exposed platforms.
Palmer said failure to pass legislation would delay, not derail, crypto’s maturation, leaving the US market operating below its potential as investors favor bitcoin-centric exposure, strong balance sheets and money-flowing infrastructure over regulatory sensitive segments such as exchanges, decentralized finance (DeFi) and altcoins.
The bill is intended to define the US crypto market structure by defining how digital assets can be classified as commodities or securities and clarifying oversight by the Securities and Exchange (SEC) and the Commodity Futures Trading Commission (CFTC). While House passage last year shifted debate toward details like stablecoin dividends and DeFi interfaces, Senate deliberations have been slower and more contentious, increasing the risk that final approval will slip into next year.
Palmer said markets are already pricing in that timing risk. Without a market structure bill, exchanges would face continued listing uncertainty, higher compliance costs and limits to expansion into higher-margin products, while stablecoin monetization could be delayed by unsettled rules around dividends and distribution.
Bitcoin and bitcoin-focused financial companies would be relatively insulated, Palmer said, given the crypto’s established commodity status, with miners and energy-backed infrastructure also less exposed.
DeFi and smart-contract platforms remain the most vulnerable as regulatory ambiguity continues to limit US participation, while custody and compliance providers would have relatively defensive positions, the report added.
Despite delays, Palmer still sees a crypto market structure bill as more likely than not, even if watered down, arguing that any version of the legislation would reduce regulatory risk and unlock broader institutional participation.
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