Revised CLARITY Act Targets Non-Decentralized DeFi Operators
A revised version of the CLARITY Act has been posted on Senator Cynthia Lummis' website, aiming to direct US regulators to determine whether 'non-decentralized' DeFi operators must comply with securities, commodities, and anti-money laundering (AML) requirements.
The bill defines such a protocol as one whose functionality, operation, or rules can be materially altered by a person or coordinated group. It also covers protocols whose controllers can restrict users or whose transactions are not governed solely by transparent, pre-established code.
Under the proposal, the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) would develop activity-based rules addressing registration, conduct, disclosure, recordkeeping, and supervision. The Treasury would establish how existing Bank Secrecy Act obligations apply to affected controllers.
The bill specifies that software and distributed ledger systems would not be required to register in their own capacity. It also says participation in an incident-response or security council would not, by itself, establish control over a protocol.