Crypto Market Braces for July Surge as Tax Reforms, Fed Policy, and Stablecoin Regulations Loom

Analyst Dan Gambardello has highlighted several key legislative developments in the cryptocurrency space that could trigger significant market movements in July. These developments include potential crypto tax reforms, changes in Federal Reserve policy, and the regulation of stablecoins.

The Trump administration is pushing for crypto tax amendments in the upcoming bill vote. The proposed reforms focus on two primary areas: eliminating capital gains taxes on crypto transactions under $600 and addressing double taxation on staking rewards. These measures aim to provide relief for smaller cryptocurrency transactions and prevent the double taxation scenario affecting staking participants across various proof-of-stake networks. Gambardello acknowledges these measures as steps in the right direction, noting that they could aid retail investors in conducting smaller transactions and participating in staking protocols.

Gambardello also discusses the potential impact of a Federal Reserve policy shift on the cryptocurrency market. President Trump has called for interest rate cuts as low as 1% and is actively seeking to replace Fed Chair Jerome Powell. If the new Fed chair cuts rates to 1%, markets could witness one of the biggest runs of all time across stocks, real estate, and cryptocurrency sectors. This policy shift follows years of quantitative tightening, with market participants waiting for the business cycle to shift toward monetary expansion and money printing resumption. The combination of ultra-low interest rates and monetary expansion could create conditions for massive liquidity flows into cryptocurrency markets.

Treasury Secretary Besson has indicated that stablecoin legislation could reach finalization by mid-July. This regulatory clarity would unlock massive stablecoin liquidity flows into cryptocurrency markets, creating infrastructure for institutional adoption and everyday usage scenarios. The US SEC has acknowledged amendments to convert Grayscale Digital Large Cap Fund into an ETF covering Bitcoin, Ethereum, XRP, Solana, and Cardano. This product provides additional institutional exposure to leading cryptocurrencies beyond the current Bitcoin and Ethereum ETFs.

Gambardello views the technical setup of Ethereum as a significant timing signal for altcoin breakouts. The convergence of several bullish drivers, such as tax reform, monetary policy changes, regulation of stablecoins, and the convergence of traditional finance, establishes a strong foundation for potential market movements. Wall Street tokenization via exchanges such as Kraken institutionalizes equity markets on-chain with round-the-clock trading capabilities. July is positioned as a pivot month where regulatory clarity for stablecoins can lead to altcoin breakouts, particularly if Ethereum breaks resistance levels.