Lummis Targets Lazarus Group with Sweeping Crypto Regulations

Senator Cynthia Lummis is pushing for the CLARITY Act, a direct response to North Korea's Lazarus Group, which has turned crypto theft into a national revenue stream. The bill would grant the Treasury Department expanded authority to freeze suspicious transactions and impose sanctions on foreign digital asset firms engaged in illicit finance.

The Digital Asset Market Clarity Act, formally designated H.R. 3633, grants Treasury new sanctions authority to target foreign digital asset entities involved in illicit activities. Section 10305 of the bill introduces a safe harbor provision for digital asset firms that freeze suspicious transactions, shielding them from lawsuits even when they unilaterally freeze customer funds.

The bill also extends Bank Secrecy Act and anti-money laundering requirements to digital asset exchanges and certain DeFi platforms, while proposing $150 million in funding for the Financial Crimes Enforcement Network (FinCEN) to build out its digital asset rulemaking capabilities. Lummis has indicated that this legislation may represent the final opportunity to implement comprehensive digital asset rules before 2030.