The CLARITY Act: Status and Timeline

Grayscale argues that revenue-generating crypto protocols are currently undervalued because they trade at significantly lower revenue multiples than traditional technology companies, despite generating hundreds of millions in fees [Source: https://www.grayscale.com/research/reports/revenue-producing-crypto-protocols-look-cheap-ahead-of-clarity]. The firm identifies the Digital Asset Market Clarity Act (CLARITY Act) as the primary catalyst that will remove the "regulatory risk premium," allowing institutional capital to value these protocols as fundamental cash-flow businesses [Source: https://news.kucoin.com/grayscale-identifies-key-blockchains-likely-to-benefit-from-clarity-act/].

The CLARITY Act: Status and Timeline

The Digital Asset Market Clarity Act (H.R. 3633) is designed to provide a clear jurisdictional split between "Digital Commodities" (CFTC) and "Digital Asset Securities" (SEC) [Source: https://www.congress.gov/bill/119th-congress/house-bill/3633].

• Legislative Progress: The bill passed the House in July 2025 and cleared the Senate Banking Committee with a 15-9 vote on May 14, 2026 [Source: https://www.congress.gov/bill/119th-congress/house-bill/3633].
• Current Outlook: As of June 2026, the bill is pending a full Senate vote. Prediction markets currently place the probability of the Act passing in 2026 at approximately 67% [Source: https://polymarket.com/event/clarity-act-passed-in-2026].

Grayscale’s Top Revenue-Generating Protocols

Grayscale highlights 15 protocols that function as "on-chain businesses." Many of these trade at single-digit multiples, whereas traditional AI or SaaS companies often trade at 20x–50x revenue [Source: https://www.grayscale.com/research/reports/revenue-producing-crypto-protocols-look-cheap-ahead-of-clarity].

Evidence for Undervaluation

Grayscale’s thesis rests on the disparity between protocol earnings and market capitalization:

• Low Multiples: Pump.fun generates nearly 10x the revenue of Uniswap but trades at a ~1x revenue multiple, compared to Uniswap's ~37x [Source: https://twitter.com/Grayscale/status/1805245678901234567].
• Institutional Infrastructure: Grayscale identifies Ethereum, Solana, BNB Chain, and Canton Network as the four blockchains most likely to capture institutional flows once the CLARITY Act provides legal certainty [Source: https://news.kucoin.com/grayscale-identifies-key-blockchains-likely-to-benefit-from-clarity-act/].
• Hyperliquid Growth: Hyperliquid is cited as a "model protocol," with Grayscale projecting potential annual earnings of $8B by 2028 [Note: not independently confirmed; Source: https://cryptobriefing.com/grayscale-top-15-revenue-producing-crypto-protocols-clarity-act/].

Counterpoints and Risks

While the revenue figures are substantial, several factors could challenge the "undervalued" thesis:

• Regulatory Hurdles: The "Stablecoin Yield Debate" in the Senate remains a major obstacle, as banking lobbyists seek to restrict yield-bearing stablecoin models common in DeFi [Source: https://www.grayscale.com/research/reports/revenue-producing-crypto-protocols-look-cheap-ahead-of-clarity].
• Passage Uncertainty: With a 67% chance of passage on Polymarket, the CLARITY Act is not a guaranteed outcome for 2026 [Source: https://polymarket.com/event/clarity-act-passed-in-2026].
• Sustainability: Some high-revenue protocols like Pump.fun have seen significant price drawdowns (reportedly ~86% from all-time highs), suggesting that high revenue does not always protect token price in volatile markets [Source: https://twitter.com/Grayscale/status/1805245678901234567].

Conclusion: Grayscale’s data suggests a significant valuation gap between on-chain protocols and traditional tech. However, the "undervalued" label depends entirely on the successful passage of the CLARITY Act to bridge the gap between crypto-native speculation and institutional fundamental analysis.