The U.S. House of Representatives has passed three important cryptocurrency bills. 1. **GENIUS Act**: This bill focuses on stablecoin regulations and passed with a vote of 308-122. It is now waiting for President Trump’s approval. 2. **CLARITY Act**: This bill outlines the overall structure of the crypto market. It passed with a vote of 294-134 and is headed to the Senate, enjoying strong support from both parties. 3. **Central Bank Digital Currency Ban**: This bill aims to ban central bank digital currencies. It has caused some political disagreements, particularly from lawmakers like Rep. Maxine Waters. Nevertheless, the outcomes show growing political support for the cryptocurrency sector. In other news, Trump plans to allow U.S. retirement funds to invest in cryptocurrencies. With the House’s approval of these new crypto laws, we think traders should brace for more market volatility, leaning towards bullish trends. This political momentum suggests a safer view of cryptocurrencies by regulators, which could drive prices up. We expect speculative money to flow into the market as the Senate debates these bills. Institutional interest is already rising. Open interest in CME Bitcoin futures has recently topped $11 billion, setting a new record and indicating that major investors are increasing their stakes. We see the progress of the CLARITY Act as a key driver of this institutional confidence. Consequently, we view market dips as chances to buy. Our main strategy is to purchase call options that expire in late Q3 or Q4. This way, we can benefit from any upside if legislation continues to progress. If U.S. retirement funds gain access to crypto, it could unlock a multi-trillion dollar market—an opportunity that the current derivatives market hasn’t fully accounted for yet, making a strong case for long-term bullish bets. We have seen similar trends before, like with the approval of spot Bitcoin ETFs in January, which led to a strong market rally. We expect a similar “buy the rumor” effect as these bills move through the Senate. Traders should watch for rising trading volumes as a key indicator. Given the uncertainty around how long it may take for legislation to pass, implied volatility will probably stay high, making options selling strategies appealing. We are considering selling cash-secured puts at prices below the current market level to earn premiums. This approach would also set up a good entry point if the market pulls back, allowing us to take advantage of trader anxiety. However, we must also be aware of the political risks, particularly from voices like Waters. Any unexpected delays or negative changes to the bills in the Senate could lead to a sharp, albeit likely brief, sell-off. For this reason, we suggest using protective puts or defined-risk strategies like call spreads to limit potential losses. The movement toward stablecoin regulations is also significant. It lays a stable foundation for the entire market. A federally regulated stablecoin market will enhance liquidity and trust, thereby simplifying large capital movements in and out of positions. This infrastructure improvement is positive for building a stronger and more efficient derivatives market.

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