Clarity Act Delay Leaves Crypto Industry in Limbo
The U.S. Senate's delay in passing the Clarity Act has left the crypto finance industry with uncertainty. Despite promises from Senate Majority Leader John Thune to bring the bill to the Senate floor in September, its fate remains uncertain. Wyoming Senator Cynthia Lummis has repeatedly stated that 'this fight is far from over,' but the delay may have significant consequences if Democrats win either the House of Representatives or both.
The Clarity Act aims to define when a digital asset is a security and when it is a commodity, ending the decades-long turf war between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). It would also create an easy federal path to registration for crypto exchanges and provide an actual registration and disclosure regime.
Even without passage of the Act, regulatory responsibility has been divvied up between the CFTC and the SEC. However, this lack of congressional action remains suboptimal, especially given the work the crypto industry has done to build a bipartisan reputation in Washington, D.C.