CLARITY Act Faces Crucial Senate Vote as Regulators Push for Blockchain-Friendly Market Structure

The CLARITY Act, aimed at providing clearer regulatory guidelines for digital assets in the US, is set to face its first Senate test on September 15. The bill seeks to establish a clear framework for determining whether a token counts as a security or commodity, which has been a long-standing issue in the industry.

Supporters of the bill, including Rep. Troy Downing and Coinbase CEO Brian Armstrong, argue that the current regulatory uncertainty is hindering innovation in the space. Downing has described the situation under former SEC Chair Gary Gensler as 'difficult for the industry,' with businesses often left without a workable framework to operate within.

Armstrong believes that clearer rules would give banks a reason to engage with crypto, rather than avoiding it. He expects passage of the bill, but acknowledges that the outcome still depends on ethics provisions and banking industry concerns.

The SEC is also pushing for changes that could make US markets more blockchain-compatible, including updates to transfer-agent rules and a roundtable discussion on moving equity markets toward 24/7 trading.