Growth Rotation and Clarity Timelines Add to Existing Headwinds Ahead of CPI

  • Another Tough Day for Risk Assets: It was another difficult session for both crypto and broader risk assets. Unlike some of the recent crypto-specific weaknesses, today's move occurred alongside a broader selloff across equities. While technology stocks recovered some losses into the close, the broader theme of rotation away from growth and toward more defensive areas of the market remains intact. This matters because crypto is now contending not only with deteriorating internal flows, but also with a macro backdrop that appears incrementally less supportive than it did several weeks ago.
  • Clarity Act Progress Has Slowed: We have not spent much time discussing the Clarity Act recently as Strategy, STRC, Hyperliquid, and the miners have dominated the conversation. However, I think it is worth revisiting. While the bill successfully advanced through the Senate Banking Committee, several meaningful hurdles remain. The primary sticking points continue to revolve around developer protections and concerns from law enforcement groups regarding illicit finance. More importantly, the legislative calendar itself is becoming increasingly relevant. If meaningful progress is not made over the next several weeks, it becomes increasingly difficult to envision the bill reaching the President's desk before year-end.
  • Prediction Markets Are Beginning to Reflect These Concerns: Odds of the Clarity Act being signed into law this year have now fallen below 50% on prediction markets. While these markets should not be viewed as definitive forecasts, they do provide a useful gauge of sentiment. Importantly, administration officials are reportedly meeting with law enforcement groups tomorrow in an effort to address some of the remaining concerns around the legislation. Those discussions could prove consequential for the bill's trajectory over the coming weeks.
checkout-thomas-lee image
checkout-logo image

Become a Member To Access Fundstrat Research

Fundstrat Direct gives individual investors access to Tom Lee's research, previously only available to banks and hedge funds.

Monthly

$199/mo

First Month Free

Join Now

Annual

-15% $2,028/yr

List Price $2,388

Savings: $360/yr

Join Now

Why Join Fundstrat Direct?

Fundstrat Direct helps you invest confidently with the same research banks and hedge funds use to navigate the market.

Daily Strategy Icon

Daily Strategy from Tom Lee & Team

Stay ahead of consensus with daily updates on key developments & catalysts and opportunities ahead.

Real-Time Market Alerts Icon

Real-Time Market Alerts

Analysis on market-moving events and actionable opportunities delivered instantly from us to you.

Curated Stock Lists Icon

Curated Stock Lists

Choose the portfolio that best suits your investment style, preferred asset class, and time horizon.

Monthly Market Update & Top Ideas Webinar Icon

Monthly Market Update & Top Ideas Webinar

Attend engaging webinars with Tom & team featuring our top ideas and near-term market outlook.

Daily Technical Strategy Icon

Daily Technical Strategy

Receive tactical opportunities, actionable signals, and fundamental analysis from our proven research team.

Live Analysis on Your Holdings Icon

Live Analysis on Your Holdings

A monthly webinar featuring live analysis on member-submitted stocks and questions.

Disclosures (show)

Events

Trending crypto assets in our research