Wall Street Is Now Backing the Clarity Act. Here's the Most Likely Scenario for What Happens Next With Crypto.

Lately, it's been all-hands-on-deck as the crypto industry attempts to push through a comprehensive piece of new legislation called the Digital Asset Market Clarity Act (Clarity Act). The newest recruit to the crypto cause is Wall Street bank Goldman Sachs (NYSE: GS), which recently voiced its support for the legislation.

The only problem is that even the support of Wall Street doesn't guarantee passage of the new legislation. That makes things dicey for investors, as they attempt to read the tea leaves and determine what exactly will happen next. With that in mind, here's a look at the most likely scenario going forward and what it might mean for crypto stocks.

Possible scenarios

After analyzing data from online prediction markets such as Kalshi or Polymarket, it's possible to sketch out a probability distribution of when the Senate will actually vote on the Clarity Act, how many members of Congress will support the legislation, and when the legislation might actually get signed into law by the White House.

Right now on Kalshi, there's an 87% chance that the Senate will vote on the Clarity Act sometime before Oct. 1, 2027. Already, there's a procedural vote scheduled for Sept. 15, so there could be time to take a full Senate vote before the midterm elections.

That's the good news. The bad news is that any number of potential issues could make final passage of this legislation close to impossible; there just won't be enough votes to make it happen in the House.

Most likely, it will be ethics concerns that hold back passage of the Clarity Act. Democratic lawmakers are simply unwilling to pass the legislation if it doesn't include strong ethics provisions to prevent elected officials from profiting from their own crypto ventures. This is, undoubtedly, a shot fired across the bow at the current Trump administration, which has dabbled in everything from meme coins to Bitcoin mining.

Again, prediction markets give a clue of what might happen. Right now on Kalshi, there's only an 8% chance of the Clarity Act passing before Oct. 1, a 16% chance before Nov. 1, an 18% chance before Dec. 1, and a 23% chance before Jan. 1.

If you believe in the predictive power of prediction markets, the first real opportunity to pass the Clarity Act might be next July. That's when the odds rise to 60%. But those odds could change dramatically, depending on the outcome of the midterm elections.

Given the Clarity Act's floundering prospects, the crypto industry will likely need support from pro-crypto regulatory bodies. For example, both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have said that they will consider new crypto-friendly rules if the Clarity Act stalls. The Office of the Comptroller of the Currency (OCC) has said that it will consider national bank charters for crypto companies. And the White House has already hinted it could move forward with several other measures to ensure America becomes "the crypto capital of the world."

Where to invest?

With that in mind, I'm targeting crypto companies -- such as Coinbase Global (NASDAQ: COIN) and Circle Internet Group (NYSE: CRL) -- that can grow regardless of the passage of the Clarity Act. Both have extensive relationships with Wall Street firms, and that should help to insulate them from any political fallout.

Coinbase Global is transforming into an "everything exchange," and Circle Internet Group has become a market leader in stablecoin finance. They are the most likely to power through even if the Clarity Act doesn't pass until next year.

I'm also keeping a close eye on crypto companies that have partnered with Wall Street firms on important new initiatives related to real-world asset (RWA) tokenization, which has been tabbed as a potential multitrillion-dollar market opportunity.

In this category, I would include fintech companies such as Ripple, the company behind the XRP (CRYPTO: XRP) token. Last year, Ripple partnered with BlackRock (NYSE: BLK) on a new tokenization initiative, and that could augur good things ahead for XRP. In 2025, the value of assets tokenized on the XRP blockchain soared by 2,200%.

Long story short, even if it takes until next year for the Clarity Act to pass, it's still possible to find some crypto stocks that can power higher over the next 12 months. The two at the top of my list are Coinbase Global and Circle Internet Group.

Dominic Basulto has positions in XRP. The Motley Fool has positions in and recommends BlackRock, Goldman Sachs Group, and XRP. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy.