Summary
Institutional crypto adoption is advancing even as the CLARITY Act faces an uncertain path. Buy side firms should prepare now by building unified infrastructure for traditional and digital assets. Automated reconciliation, integrated data, continuous risk oversight, and 24/7 operations will be essential as lending, perps, and other crypto strategies expand.
As of August 25, 2026, Kalshi put the odds of the Senate passing the Digital Asset Market CLARITY Act by the end of the year at under 25% and at less than 50% by April 2027.i Kalshi placed odds at 85% back in February. On September 15, the U.S. Senate will convene for a procedural vote on whether to limit debate on the bill and advance it to a full floor vote. That requires 60 votes, and anything less would be a death knell for its passage by the end of this year. But firms need not abandon their crypto dreams. The executive branch, the House of Representatives, buy side investment firms, institutional investors, Wall Street, and of course crypto-bros, are all pushing to bring crypto business into TradFi.
The question is, should managers shelve crypto and go about their business of operationalizing agentic AI, integrating private market assets, and driving alpha? No. Blockchain financial products are going to change the global financial system. The convergence of TradFi and DeFi is happening, and regulatory guardrails will be arriving faster than you think.
If the September 15 session yields at least 60 votes to go to a full floor vote, an uncertain period of debate and deliberations will follow. The midterm elections will affect the legislative calendar before and after voting. After the Senate's review of the amendments and text, another reconciliation with the House version will be necessary, followed by a presidential signature.
However, the SEC and CFTC have moved decisively to lay regulatory groundwork, even explicitly working together to advance crypto frameworks via the March Memorandum of Understanding. The SEC is accepting public comments until mid-October on its Regulation Crypto Assets proposal, which sets out a tailored securities offering regime for certain investment contracts involving crypto assets.ii On August 26, the SEC sent a proposed rule to the executive branch, which would clarify the framework for the custody of crypto assets for investment advisers and investment companies.iii The SEC is an executive branch agency (though independent in policymaking), so if it finalizes its framework, the immediate floodgates will open for digital asset businesses such as crypto-backed lending and perpetual contracts (perps).
Recently, the CFTC chairman said his agency would move expeditiously to propose market structure for crypto assets. Major commercial and retail banks are preparing to issue their own stablecoins to take on deposits, indicating that large-scale infrastructure installation is actively underway across the industry. If the CLARITY Act fails to become law by the end of the year or by the middle of 2027, firms should not regard this as a six-month reprieve.
"Today, we’re once again at an inflection point. Another moment when the choices we make will shape the markets and opportunities of the decades ahead. We’ve crossed the Rubicon and are standing at a new frontier of finance. It’s not a question of whether innovations like blockchain, artificial intelligence, and prediction markets will transform our markets. It’s a question of where this innovation will take place and who will write the rules." — Chairman Michael S. Selig, CFTCiv
The business is simply going to be too big to ignore or delay. Running separate platforms for crypto, public markets, and private markets cannot suffice or be sustained. Firms watching the Senate stumble on the CLARITY Act may be tempted to roll the dice and remove upgrades from the technology budget. If a firm's front office or clients go live with crypto trading and the back office cannot support it, clients won't hesitate to head for the exits in favor of competitors to avoid missing out on alpha. If you see policymakers start to unfurl a green flag, you need to hit the gas to avoid operating in a bifurcated environment. Disconnected systems introduce severe operational, financial, and regulatory risks. A unified platform captures transaction data at the source and dynamically maps it down to the books of record without requiring manual downstream transformations.
We have been preaching the unified data infrastructure sermon for years, but the arrival of institutional digital asset operations makes it more profoundly important. The past decade of growth of alternative asset classes, especially in private credit, has changed the industry's structural workflows and risk management practices. Blockchain is going to change the playing field in finance. In a few years, virtually every asset will be tokenized. Speed and data volumes will increase commensurate with the tokenization of the global economy.
Trying to get a total portfolio view of exposures, positions, and performance was difficult enough, given the asset class convergence at most firms. Blockchain-based financial instruments introduce a whole new level of complexity in 24/7 trading, instant settlement, and continuous liquidity management. In crypto, there is no end-of-day to reconcile. There's no market closing time. There's no morning cash position. T+1 is too slow.
If you’re working in a hyper-accelerated trading environment, you must also accelerate risk oversight, credit reviews, balance-sheet funding decisions, and reconciliation accordingly. Systems must be connected so workflows can be automated. Fragmented architecture cannot support this transaction velocity, leading to major system latency and critical reconciliation breaks. Operating separate traditional and crypto platforms creates a fractured, unsynchronized picture of a firm's positions, too onerous to fix manually. Treasury, accounting, and risk teams are forced to cobble together exposures manually using separate, desk-level tools, making a comprehensive, real-time house view of portfolio risk impossible.
Because of the multi-venue processing demands of digital assets, relying on manual spreadsheets or vibe coding to bridge the system gap is completely out of the question. Further, that approach limits the ability to scale and exposes the firm to massive regulatory and data-drift risks.
Registered spot vehicles are our institutional crypto on-ramps. EY's global institutional investor digital assets survey revealed that 66% had exposure via spot crypto ETFs and 81% preferred spot exposure through a registered vehicle.v Now, managers can get ready to trade all sorts of digital asset strategies. Trying to time regulation is the wrong infrastructure strategy. We are on the cusp of a new era of diversified multi-asset strategies, including spot crypto and ETFs, perps, futures, options, prediction market contracts, and crypto-backed loans, alongside traditional public and alternative assets. What phase is your firm in its institutional crypto infrastructure adoption journey today?
Everything happens faster in crypto, including the trade lifecycle, innovation, and even regulatory progress. Your firm must be ready to move just as fast.
Discover how your operating model compares to the next generation of institutional digital asset investing.
Phillip Silitschanu
Phillip Silitschanu leads Arcesium's global digital asset commercial efforts as Senior Vice President, Digital Assets. Phillip is an expert and thought leader in the FinTech, blockchain, cryptocurrency, and digital assets space, known for his work as the research director leading IDC’s (Blackstone) global blockchain practice, and in various strategic roles within the financial services industry. He has authored and co-authored numerous whitepapers, reports, and books on these topics and is a recognized speaker and expert cited by major media outlets like the Financial Times and CNBC.
Sources:
i CNBC, August 25, 2026. https://www.cnbc.com/2026/08/25/kalshi-traders-see-low-likelihood-of-major-crypto-bill-becoming-law-this-year.html
ii SEC, August 18, 2026. https://www.sec.gov/newsroom/press-releases/2026-76-sec-proposes-new-regulation-crypto-assets
iii Bloomberg, August 26, 2026. https://www.bloomberg.com/news/articles/2026-08-26/sec-preps-overhaul-of-crypto-custody-rules-for-investment-firms
iv CFTC, August 20, 2026. https://www.cftc.gov/PressRoom/SpeechesTestimony/opaselig10
v EY, 2025. https://www.ey.com/en_us/financial-services/institutional-digital-assets-survey
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