Bernstein: Clear U.S. Crypto Regulations Could Make the Country a Global Digital Asset Hub

The United States is entering a defining phase in its journey to become a global crypto and digital asset hub, according to a new report by Wall Street brokerage firm Bernstein.Bernstein analysts said the gradual formation of a comprehensive U.S. crypto regulatory framework is setting the stage for institutional expansion and long-term market stability. The firm highlighted several legislative and market milestones as evidence that the regulatory landscape is maturing.GENIUS and CLARITY Acts Set the Stage for Market TransformationAccording to the report, the GENIUS Act has already accelerated growth in the U.S. dollar stablecoin market, pushing total supply above $260 billion. The upcoming CLARITY Act, expected to be introduced by the end of 2025, will define the market structure for U.S. digital assets for the first time.This legislation is expected to:Clearly delineate the jurisdictional boundaries between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).End years of regulatory ambiguity surrounding digital assets.Provide a unified framework for the issuance and trading of tokenized securities.Project Crypto: Integrating Blockchain and U.S. Capital MarketsBernstein’s report emphasized that Project Crypto, an initiative led by SEC Chairman Atkins, is central to this regulatory transformation. The project aims to integrate blockchain infrastructure with traditional securities markets, potentially excluding most crypto assets from existing securities laws.Under this approach, tokenized stocks and bonds could circulate under a unified regulatory system — a shift that could redefine the U.S. capital market’s interaction with blockchain-based assets.Institutional Momentum Builds as Regulatory Clarity ImprovesBernstein noted that U.S. crypto ETF assets have surged to $160 billion, with institutional investors now representing about 25% of total holdings. Since early 2024:Crypto firms have raised more than $4 billion through IPOs.The combined market capitalization of listed crypto companies has climbed from $80 billion to $380 billion.Coinbase and Robinhood have both been added to the S&P 500 index, signaling deeper integration between traditional finance and crypto markets.A Sustainable Crypto Cycle EmergingBernstein concluded that a clear regulatory pathway, the return of institutional capital, and the maturity of on-chain financial infrastructure are driving what it described as a “more sustainable new crypto cycle.”As the U.S. regulatory framework solidifies through the GENIUS and CLARITY Acts and the continued progress of Project Crypto, the report argues that the U.S. is “moving decisively toward becoming the world’s crypto capital.”