NY AG Warns Proposed Crypto Bill Would Weaken State Oversight

New York Attorney General Letitia James has spoken out against the proposed Digital Asset Market Clarity Act, arguing that it could weaken state regulators' ability to investigate scams and hold platforms accountable. The bill would shift oversight of digital asset markets from states to the Commodity Futures Trading Commission.

In written testimony submitted to the Senate Permanent Subcommittee on Investigations, James noted that complaints about cryptocurrency scams received by her office have tripled over the past three years, with reported losses totaling nearly $500 million over five years. She urged Congress to strengthen oversight of cryptocurrency companies and impose stronger consumer protections on digital asset platforms.

James called for crypto platforms to comply with anti-money laundering, know-your-customer, and cybersecurity requirements, as well as conduct surveillance for suspicious activity and market manipulation. She also proposed making platforms and intermediaries financially liable when they fail to protect customers from fraud.