Senate Unveils Revised Clarity Act with New Crypto Trading Rules

The Senate has introduced an updated version of the Clarity Act, a market-structure bill that includes new federal rules for certain crypto trading protocols. The revised bill retains over 114 requests from Democratic colleagues and is considered a bipartisan product, according to Senator Cynthia Lummis.

Lummis stated that the Clarity Act allows the United States to write its own rules for digital assets, rather than following those set by other countries like Singapore or the UAE. The bill creates a new class of 'non-decentralized finance trading protocol' and requires protocols meeting this standard to register with the Commodity Futures Trading Commission.

The updated Clarity Act also instructs the CFTC and Treasury Department to consider rules for differentiating between decentralized protocols without controlling parties and those marketed as decentralized but have governance or upgrades executed by a known party. The bill applies these amended DeFi language to spot and cash transactions involving digital commodities.