James Warns CLARITY Act Could Weaken State Crypto Enforcement Efforts

New York Attorney General Letitia James has expressed concerns that the proposed Digital Asset Market Clarity Act could weaken state regulation of digital assets. According to James, this would shift oversight from state regulators to the Commodity Futures Trading Commission, undermining state and local enforcement efforts.

James pointed out that her office has seen a significant increase in complaints about crypto scams, with reported losses totaling nearly $500 million over five years. This is three times the number of complaints received in the past three years.

The attorney general urged Congress to strengthen oversight of cryptocurrency companies and impose stronger consumer protections on digital asset platforms. She recommended that crypto platforms comply with anti-money laundering, know-your-customer, and cybersecurity requirements, and conduct surveillance for suspicious activity and market manipulation.