Blockchain adoption continues to grow in institutional finance, even as the clarity of U.S. regulations remains ambiguous, according to a new ClearStreet analyst brief.
The company argues that while delays in the clarity bill may slow parts of the domestic cryptocurrency market, they have not hindered broader institutional participation in the token, stablecoin, and blockchain financial infrastructure space.
The Senate Banking Committee postponed planned debate on the Clarity Act after Coinbase objected. Although the Senate Agriculture Committee is still scheduled to take up the bill on Jan. 27, analyst Owen Lau of Clear Street warns that the overall legislative timeline could be delayed until March or later.
Concerns about competition from stablecoins
In comments reported by Clear Street, Coinbase CEO Brian Armstrong highlighted several concerns about the bill, including the risk that banking pressure could limit the ability of cryptocurrency exchanges to pass stable rewards to users.
Clear Street believes this outcome is becoming increasingly likely outside of narrowly defined activity-based rewards such as payments, loyalty programs, e-wallets or staking.
The company argues that these restrictions would tilt competition in favor of traditional banks by allowing them to maintain their interest margins while reducing the consumer benefits associated with stablecoins.
“In our view, the bill risks shifting from its original goal of promoting cryptocurrency innovation to protecting bank margins and restricting competition,” Lau wrote.
Clear Street is considering two possible paths: either the cryptocurrency industry agrees to legislation on unfair conditions, or it withdraws from the process altogether. Both scenarios could slow the adoption of blockchain technology in the United States and weaken the global competitiveness of U.S.-issued stablecoins.
The institutional dynamic continues without the bill structuring the market
Despite these regulatory challenges, ClearStreet highlighted that blockchain adoption has continued to advance even in the absence of a comprehensive framework for the structure of the US market.
Major financial institutions, including Vanguard, Charles Schwab, Bank of America, Morgan Stanley, JPMorgan Chase, the New York Stock Exchange, and Bermuda-based entities, have expanded their involvement in blockchain-based products and infrastructure.
Growth areas highlighted by the company include tokenized money market funds, tokenized stocks, and prediction markets. Clear Street added that while a supportive policy environment can accelerate the pace of adoption, institutional commitment has proven resilient even in the absence of supportive legislation.
Revised forecasts for companies exposed to the cryptocurrency market
Clear Street, in light of regulatory uncertainty and changing market conditions, is canceling its forecasts and price targets for several cryptocurrency-related companies.
For Bakkt (BLSH), the company increased its adjusted EBITDA estimate for the fourth quarter of 2025 to $37.8 million from $35.5 million, driven by higher-than-expected trading revenue.
Adjusted EBITDA estimates for 2026 and 2027 were also raised slightly, driven by continued strength in subscription and services revenues. However, Clear Street lowered its price target on the stock from $57 to $50, while maintaining a Buy recommendation.
For Coinbase, Clear Street lowered its adjusted EBITDA estimate for the fourth quarter of 2025 to $630 million from $748 million, due to lower-than-expected trading volumes for December. Although the consensus estimate of $731 million seems optimistic, the company notes that the principle of long-term blockchain adoption remains valid.
Coinbase’s price target was lowered from $415 to $344 to reflect lower earnings expectations and a lower industry valuation multiple, with the buy rating remaining unchanged.
Stablecoin Growth Remains Healthy
Clear Street updated its forecast for Circle (CRCL), lowering its adjusted EBITDA estimate for the fourth quarter of 2025 to $112 million from $116 million, due to a lower-than-forecast average market cap for USDC. The company estimates that the final market value of USDC increased by 72% on an annual basis and 2% on a quarterly basis during this period.
Despite the reduction in near-term estimates, ClearStreet highlighted that long-term adoption drivers remain in place, including prediction markets, tokenization, AI applications and cross-border payments. The company added that growth in non-core revenue streams could also help boost profits. The target price for Circle shares was reduced from $110 to $85 while maintaining the “hold” recommendation.
Expectations
ClearStreet concluded that while regulatory delays and political compromises may weigh on sentiment in the short term, blockchain adoption is increasingly driven by institutional demand rather than legislative dynamics alone.
“Enterprise use cases continue to grow even without a favorable clarity rule,” the company said, adding that a clearer policy would accelerate adoption – but its absence hasn’t stopped it.
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