CLARITY Act Advances, Sets Stage for Cryptocurrency Regulation Vote

The US Senate is pushing forward with the CLARITY Act, a bill aimed at regulating cryptocurrency protocols. Senator Cynthia Lummis introduced the revised version of the bill, which includes over 114 measures from the Democrats' proposal.

The updated bill requires registration with the Commodity Futures Trading Commission (CFTC) for non-decentralized finance protocols that are under direct control or have an agreement to control functionality or governance changes. This provision was requested by the Democrats during negotiations.

Lummis stated that the revised bill has narrowed its DeFi provisions to include only spot and cash transactions for digital commodities, addressing concerns from tribal governments regarding prediction markets.

However, disputes remain over issues such as stablecoin rewards, illicit finance, and cryptocurrency ethics. The Democrats have criticized the current provision related to President Donald Trump's cryptocurrency investments and interests in World Liberty Financial, calling it inadequate.