Optimism on bitcoin is rising quickly on the push for the U.S. Clarity bill, but there has been a warning that crowd sentiment may have overheated.

On May 16 local time, blockchain media outlet Cointelegraph reported that Santiment pointed out markets generally move against public expectations.

The U.S. Senate Banking Committee advanced the Clarity bill, the Digital Asset Market Clarity Act, by a bipartisan vote of 15 to 9. All 13 Republican members voted in favour along with 2 Democrats, while 9 Democrats voted against. The bill contains provisions to provide a clearer regulatory framework for the cryptocurrency industry.

Santiment said expectations related to bitcoin rose sharply on social media after the vote. It said this reflected hopes that bitcoin and the crypto market had moved one step closer to final legislation. Social media reactions on bitcoin were tallied at 1.55 bullish views for each bearish view. Santiment said the skew in sentiment could be a warning signal.

Some in the market also voiced expectations that the upward trend could continue. Michael van de Poppe (마이클 반 데 포페), founder of MN Trading Capital, called the bill the biggest and most historic legislation for the entire industry and said it could be a strong catalyst for the next bull market.

Patrick Witt (패트릭 위트), a White House crypto adviser, called the committee vote a major step forward but said legislation was not yet at a finished stage. He also said that as senators from both parties have cited a need for further discussion, support needed for passage in the full Senate must continue to be secured.

Santiment said passage of the Clarity bill could be positive for the crypto market over the long term. It cited expectations that clearer rules in the United States could lead to institutional money and large participants entering or re-entering the market. It added that some expectations for the bill's passage may already be partially reflected in prices of major cryptocurrencies.

Overall investor sentiment in the market is somewhat cautious. The Crypto Fear and Greed Index stood at 31 on May 16, in the fear zone.