US Attorneys General Oppose Bill Allowing SEC to Override State Authorities in Digital Asset Regulation

A group of 18 state attorneys general in the US, led by New York Attorney General Letitia James, have expressed opposition to the Digital Asset Market Clarity Act (CLARITY Act) currently being debated in Congress.

The CLARITY Act aims to clarify the regulation of digital assets but has been criticized for potentially reducing the authority of state authorities to protect investors from cryptocurrency scams. The attorneys general are concerned that the bill, if passed, could undermine their efforts to combat these crimes and would instead give the SEC broad discretionary powers.

The attorneys general pointed out that between 2017 and 2025, they have taken enforcement actions on over 330 cases involving digital asset-related scams. They urge Congress to maintain the authority of state authorities to regulate securities, regardless of whether they are tokenized or not.