The Senate Banking Committee votes today on the CLARITY Act, marking a critical moment for 50 million U.S. crypto holders who have waited years for clear regulatory rules. The bill establishes clear rules separating which digital assets are securities and which are commodities, ending the jurisdictional confusion between the SEC and CFTC that has plagued the industry. The legislation requires digital asset exchanges, brokers, and dealers to comply with Bank Secrecy Act regulations, including anti-money laundering programs, suspicious activity reporting, and sanctions compliance. Once approved by the Banking Committee, the bill will merge with parallel legislation that already cleared the Senate Agriculture Committee before heading to the House for another vote. The bill needs 60 votes to clear the Senate, requiring Democratic support, making today's vote a pivotal moment for crypto regulatory clarity.
Crypto executives spent tens of millions of dollars to help elect sympathetic legislators in 2024, then descended on Washington to advocate the industry's interests in Congress. Since President Trump took office last year, the cryptocurrency industry has notched a series of political victories, escaping lawsuits, negotiating business-friendly policies and persuading the White House to create a national Bitcoin stockpile. The result is a bill that would make it easier for crypto firms to declare that digital currencies are not securities governed by the strict system of oversight that applies to stocks and bonds on Wall Street. White House crypto director David Sacks called today's markup 'a monumental step in making the U.S. the Crypto Capital of the World.'
According to Coinbase, the latest CLARITY Act text improved language around decentralized finance, tokenized stocks and the Commodity Futures Trading Commission's role in crypto markets. The legislation protects software developers who publish code without controlling customer funds and preserves Americans' ability to self-custody their digital assets. The Senate Banking Committee released a 309-page revised draft before today's markup, which includes language tied to non-custodial developers and infrastructure providers that could shape how DeFi builders are treated under federal law. The revised version would allow some stablecoin rewards while limiting deposit interest, protect decentralized finance (DeFi) developers from certain regulatory burdens, and clarify the division of oversight responsibilities between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). Armstrong noted that the bill is now closer than ever to addressing regulatory clarity and adoption concerns for crypto and DeFi markets.
Senator Kirsten Gillibrand (D-NY) said the CLARITY Act will not pass the Senate without a conflict-of-interest provision, creating a critical sticking point. Senator Bill Hagerty (R-TN) introduced an amendment to ban central bank digital currencies issued by the Federal Reserve, while Senator Jack Reed (D-RI) wants to restrict stablecoin yields further and scrap protections for software developers. Senator Elizabeth Warren (D-Mass.) introduced dozens of amendments, including one that would 'prohibit political corruption in banking applications and presidential bank ownership,' directly targeting World Liberty Financial's effort to obtain a U.S. banking charter. Democratic Senator Chris Van Hollen (D-MD) wants to ban the president and senior government officials from owning, promoting, or affiliating with digital assets businesses. During discussions in Congress, Democrats have voiced fears that the bill would gut the government's enforcement powers over a fast-growing sector in which Mr. Trump's family has become a major player.
