US Crypto Legislation Boosts Sentiment, AI Trade Slowdown Fuels Market Optimism

Crypto markets are poised for a recovery as progress on landmark US crypto legislation boosts sentiment.

The CLARITY Act, which would define the regulatory roles of the Securities and Exchange Commission and Commodity Futures Trading Commission over digital assets, is nearing completion according to US Treasury Secretary Scott Bessent.

This comes after a prolonged period in which AI-related stocks dominated speculative markets, with the Philadelphia Semiconductor Index (SOX) surging roughly 110% since the launch of ChatGPT in late 2022.

However, the rally has begun to lose momentum as investors grew increasingly concerned about lofty valuations and the risk of overcapacity in AI infrastructure spending.