Benchmark says US crypto market may face lasting structural constraints without market structure bill in 2025

Wall Street brokerage Benchmark said on January 26 that if the US Congress does not pass cryptocurrency market structure legislation this year, the US crypto market will avoid a return to the 2022-2023 enforcement-heavy environment but will remain structurally constrained even as global adoption and institutional interest accelerate, according to a report by analyst Mark Palmer. Palmer wrote that the absence of legislation would maintain a structural risk premium across much of the digital asset ecosystem, cap valuation expansion for US-focused platforms, and delay rather than halt the maturation of cryptocurrencies, steering investors toward bitcoin-centric exposure, strong balance sheets and stable-cashflow infrastructure and away from regulation-sensitive trading platforms, DeFi and altcoins. The proposed bill is intended to clarify when digital assets are treated as commodities or securities and to delineate oversight between the SEC and CFTC, but despite House passage last year and a shift in debate toward issues such as stablecoin yield and DeFi interfaces, negotiations in the Senate have progressed more slowly amid wider disagreements and rising risk that final approval could slip into next year, a timeline Palmer believes markets are already pricing in. The report added that failure of the market structure bill would prolong listing uncertainty, higher compliance costs and limits on high-margin product expansion for trading platforms, could delay monetization of stablecoins due to unresolved rules on yield and distribution, while bitcoin and bitcoin-focused asset managers, as well as miners and energy-backed infrastructure, appear less exposed; DeFi and smart contract platforms remain the most vulnerable under regulatory ambiguity, with custodians and compliance providers in relatively defensive positions, and Palmer still assigns a high probability that some form of the legislation will ultimately pass and reduce regulatory risk, supporting broader institutional participation.