Lummis Introduces CLARITY Act to Tackle Cryptocurrency Loopholes Exploited by North Korea

U.S. Senator Cynthia Lummis has introduced the Cryptocurrency Legal Accountability and Regulatory Improvement for Transparency Act, or CLARITY Act, to combat illicit financial activities in the cryptocurrency space.

The bill aims to close regulatory gaps that have enabled state-sponsored hacking groups like North Korea's Lazarus Group to move stolen cryptocurrency across borders.

The Lazarus Group has been linked to some of the largest cryptocurrency thefts in history, including a $620 million hack of the Axie Infinity bridge in 2022.

The CLARITY Act would grant the U.S. Treasury Department expanded authority to freeze suspicious transactions before funds are transferred, particularly those linked to sanctioned entities or state-sponsored hacking operations.