Key Highlights
- Kristin Smith urged the Senate to prioritize the CLARITY Act before Congress’s crowded fall legislative schedule.
- She said the bill is about 99% finalized and would establish clear federal crypto regulations and consumer protections.
- Smith argued passing the legislation would strengthen U.S. leadership in digital asset regulation and discourage activity from moving offshore.
Kristin Smith, President of the Solana Institute, has urged the U.S. Senate to prioritize passage of the CLARITY Act, a proposed cryptocurrency market structure bill.
In an X post on Tuesday, Smith highlighted the legislative constraints facing Congress, noting that standalone bills require significant floor time and procedural votes. Referencing the GENIUS Act, which took approximately four weeks on the Senate floor last year, she stressed that the CLARITY Act must move more efficiently.
According to Smith, the more than 600-page bill is about 99% finalized following negotiations involving Senate staff, lawmakers, and the White House.
Why Smith wants the Senate to act now
Smith said the window for action is narrowing. If the bill does not advance before August, it could face additional delays because of the fall legislative calendar, which includes government funding deadlines, consideration of the National Defense Authorization Act (NDAA), the October election period, and a potentially unpredictable lame-duck session.
The CLARITY Act aims to establish a federal regulatory framework for digital assets. According to Smith, key provisions include customer fund segregation, federal registration requirements, enhanced disclosures, and bankruptcy protections for consumers.
She cited the 2022 collapse of FTX, which resulted in approximately $8 billion in customer losses, as an example of the risks posed by the current regulatory framework. Smith also said the legislation would provide law enforcement with additional tools to combat illicit activity, including expanded blockchain tracing capabilities, additional funding, investigator training, and a dedicated Treasury cyber center.
The bill also incorporates the Blockchain Regulatory Certainty Act, which would provide protections for developers of non-custodial software tools, a provision supported by Senator Ron Wyden.
The case for passing CLARITY, according to Smith
Smith also pointed to what she described as bipartisan support for the legislation. She noted over 70 House Democrats previously supported a related framework, and 18 Senate Democrats backed the GENIUS Act last year. She described the CLARITY Act as focused primarily on consumer protection rather than partisan interests.
With approximately one in four American adults now holding digital assets, Smith argued that clear federal rules are essential to protect users, particularly as adoption grows among women and households using crypto for cross-border remittances. She warned that without domestic regulation, activity could shift offshore to jurisdictions with fewer protections.
Smith added that the legislation could have broader international implications. She said other countries began aligning parts of their regulatory approaches with U.S. standards following passage of the GENIUS Act and argued that the CLARITY Act could similarly influence global digital asset market regulation.
What happens next for the CLARITY Act
Meanwhile, Senate Minority Leader Chuck Schumer has forwarded two names each for the open Democratic seats on the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), according to a report by Semafor’s Eleanor Mueller.
The move comes after months of delays and political negotiations that had linked these appointments to discussions over the CLARITY Act, a major crypto regulatory bill. One individual familiar with the situation told Mueller, “Nobody wants any of these nominees to get flamed before they get a fair chance.”
Meanwhile, the Senate is expected to hold an initial procedural vote on the CLARITY Act before August 7, although prospects for final passage before the August recess remain limited. In an X post on Monday, journalist Brendan Pedersen stated, “The politics of CLARITY are live this week. We still expect an initial vote before Aug 7.”
Also Read: Nexo Confirms MiCAR Compliance Across Europe With New Partners
