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Deng Tong, Bitchain Vision
Recently, the U.S. House of Representatives is considering the Digital Asset Market Clarity Act (CLARITY Act).The bill is based on the 21st Century Financial Innovation and Technology Act and is a market structure bill.U.S. Senator Elizabeth Warren warned: The bill could allow non-crypto companies to circumvent the Securities and Exchange Commission (SEC) regulation through asset tokenization.According to this House of Representatives bill, listed companies like Meta or Tesla can completely get rid of SEC regulations by simply putting their own stocks on the blockchain.
What is the content of the CLARITY Act?What is the significance of the bill for the development of the crypto industry?How do industry insiders evaluate the bill?
1. Quick review of the content of the CLARITY Act
On May 29, 2025, House Financial Services Committee Chairman France Hill introduced the Digital Asset Market Clarity Act, aiming to eliminate long-standing ambiguity in digital asset regulation by clarifying the responsibilities of the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).
On June 23, the House Financial Services Committee and the Agriculture Committee submitted the bill, which defines digital goods as: digital assets whose value is “intrinsically linked” to the use of blockchain.
“Maturity” blockchain
The CLARITY Act requires that the value of digital goods associated with mature blockchains “derive primarily from the use and operation of blockchains” and shall not restrict or grant any user privileges, and restrict certain holders from holding less than 20% of the circulation unit.Maturity (or expected maturity) will be a prerequisite for certain characteristics of the Act’s framework.
The bill would allow digital commodity issuers to prove to the SEC that their relevant blockchains are mature and determine the SEC’s criteria for evaluating blockchain maturity.The CLARITY Act willA mature blockchain is defined as “the blockchain system and its associated digital goods are not jointly controlled by any individual or group.”
The bill contains specific time limits – blockchains can only mature within four years of the bill’s passage, or after their first sale, whichever is later.The SEC will ensure maturity through semi-annual reports and disclosures, including the amount of funds raised by the issuer, the timetable for the development of the blockchain system, and how to achieve maturity.
How the SEC will use this maturity information remains to be seen.According to the draft, certain information can be submitted to the SEC when the digital commodity issuer or its related or affiliated person believes that the blockchain has reached maturity.
The SEC can reject the application within 60 days, or apply for an extension due to insufficient information or novel/complexity of the problem.If the SEC does not issue a rejection notice within 60 days, the blockchain will automatically be considered mature.
The benefit for founders and developers is that the process is long but time-bound, so issuers do not need to wait indefinitely for potential certification from the Securities and Exchange Commission (SEC).Digital commodities are expected to go through similar repetitive processes when applying for certification from the U.S. Commodity Futures Trading Commission (CFTC).
SEC Jurisdiction
The Act would provide exemptions for investment contracts involving digital goods on mature blockchains that meet certain conditions.Issuers relying on exemptions must limit sales of digital goods to $75 million within 12 months.The bill would require issuers who rely on exemptions to submit a “issuance statement”.Issuers of digital goods related to immature blockchains will face additional reporting requirements.The bill will direct the SEC to set rules within 270 days of the bill’s enactment to implement additional requirements for immature blockchains and allow them to limit such issuers’ dependence on exemptions to raise additional funds.
The bill does not limit access to qualified investors based on income or net worth participation thresholds.
The bill implies thatSome digital goods bound by the bill may also be investment contract assets, These digital assets are sold under an investment contract (a type of securities).However, “investment contract” does not include “investment contract assets”.This seems to mean that a certain instrument must be issued through an investment contract to constitute an “investment contract asset”, but the “investment contract asset” itself is not an investment contract, and therefore is not a securities either.
The bill would allow traditional securities market participants registered with the U.S. Securities and Exchange Commission (SEC) to participate in secondary market transactions after notifying the U.S. Commodity Futures Trading Commission (CFTC) (but not required), provided that the regulation of the two institutions is “consistent”.The bill would allow alternative trading systems (ATS) registered with the U.S. Securities and Exchange Commission (SEC) to trade any digital goods that meet the listing standards under certain restrictions.The SEC will have jurisdiction and rule-making power over digital commodity transactions for these market participants.
CFTC jurisdiction
The Act would give the U.S. Commodity Futures Trading Commission (CFTC) exclusive regulatory jurisdiction over any digital commodity transactions (including spot or cash markets) that have been registered with or are required to conduct in the entity it has registered.The bill would require digital commodity exchanges (DCEs), such as the centralized platform that currently dominates cryptocurrency trading, as well as digital commodity brokers and traders to register with the CFTC.The bill will set out core principles that exchanges must adhere to, including transaction monitoring, recordkeeping and reporting, handling of antitrust and minimizing conflicts of interest.The bill would prohibit DCE from mixing its assets with client assets, but clients can waive that right for some reason.The bill would prohibit DCE and its affiliates from trading for proprietary accounts, but would allow the CFTC to set rules that allow such transactions to be conducted for certain specific purposes.The bill would require the update of the bankruptcy law to account for funds held by DCE, but would remove those exempt from the mixed ban.
Commodity Exchange (DCE) will be allowed to provide only digital goods whose relevant blockchains have been certified as mature, or (for immature blockchains) whose issuers meet ongoing reporting requirements.Before a new digital commodity is available, DCE must publish certain information, including source code, transaction history and “digital commodity economics.”The new certification will take effect 20 days after the application is submitted.The veto of the CFTC will require detailed analysis.
Temporary registration and other regulations
The bill will establish a temporary registration system to regulate digital currency exchanges (DCEs), brokers and traders before the bill is implemented.The entity applying for registration will be deemed to be compliant with the temporary registration system, subject to certain conditions, including the protection of client assets and the permission of the CFTC to access its books and records.The clause that allows the CFTC to charge fees to an intermediary that submits an application under the temporary registration system will expire after four years.
Decentralized financial activities such as verification will be excluded from the bill’s requirements, but will not be excluded from the agency’s anti-fraud and anti-manipulation power.
The bill:
1) Apply the Bank Secrecy Act to new digital currency exchanges, brokers and traders to comply with anti-money laundering requirements;
2) Amend the Bank Holding Companies Law to allow financial holding companies and eligible banks to carry out digital commodity activities;
3) Limit the jurisdiction of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) to the scope of transactions involving registered entities;
4) Create qualified digital asset custody requirements (possibly including banks) that may be subject to state or federal regulation of different regulatory agencies, depending on the type.
2. The significance of the CLARITY Act
1. From focusing on whether it is securities to “be it decentralized enough”
The CLARITY Act no longer focuses on “whether a cryptocurrency is a securities”, but on maturity—“how decentralized?” is crucial, because the degree of decentralization will ultimately determine the jurisdiction of the SEC (tokens that were early controlled by centralization, designated as “investment contract assets”) or the CFTC (tokens for more mature, fully decentralized blockchain network tokens, designated as “digital goods”).
2. Create a new framework for digital asset supervision
Clarify the division of labor between SEC and CFTC and improve long-term regulatory fuzzy issues.
3. Promote the development of the DeFi ecosystem and attract traditional finance to enter
The bill clearly confirms that decentralized financial agreements can and protect.The bill covers autonomous custody and anti-fraud enforcement, while acknowledging that truly decentralized protocols operate differently from traditional financial entities.This recognition is crucial to the maturity of the DeFi ecosystem and its integration with the traditional financial system.
Additionally, the bill provides a regulatory framework for traditional financial participants so that they can get involved in the cryptocurrency industry without worrying about compliance risks.
3. Prompts from Stand With Crypto
On July 7, 2025, Stand With Crypto, a nonprofit advocacy organization in Coinbase, jointly sent a letter to Congress, urging them to quickly pass the CLARITY Act.Alliance members also include some giants in the non-fungible token (NFT) space, such as OpenSea and Dapper Labs.
The original text of the letter is as follows:
Dear U.S. House of Representatives:
Thank you for your continued commitment to promoting innovation in the United States and strengthening consumer protection.On behalf of 52 million Americans with cryptocurrencies, I would like to ask you to support the CLARITY jointly formulated by both parties.We know,Some have tried to politicize cryptocurrency legislation, but as cryptocurrencies completely reshape the global economy, the United States will risk lagging behind unless we adopt a pro-cryptocurrency policy that embraces blockchain technology in a comprehensive way.
We are facing a critical crossroads.Cryptocurrencies not only lay the foundation for a more inclusive, transparent and secure digital economy, but also open the door to economic opportunities, innovation and financial empowerment on an unprecedented scale.
The U.S. leadership in the cryptocurrency sector has shown signs of a decline.We cannot let inaction and uncertainty endanger our ability to safeguard the future of the U.S. economy.Most importantly, the U.S. cryptocurrency industry needs market structure – which ensures clear rules and provides developers, users and advocates with the regulatory transparency needed to continue innovation.
Cryptocurrency developers need clear guidance and safeguards to create blockchain systems where users can control their digital assets; consumers need consistent standards of transparency, security and accountability to protect them from fraud, losses and abuse; the lack of standardized rules currently hinders institutional adoption and innovation, forcing talent and businesses to turn to more crypto-friendly overseas jurisdictions.The CLARITY Act addresses these issues through its regulatory framework, including clarifying the roles and responsibilities of the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).The CLARITY Act will not only empower developers to innovate, but will also protect consumers through choices, promote more people to participate in the blockchain economy and strengthen national security.
The 65 signed cryptocurrency organizations representing more than 6,100 jobs in 21 states, support the efforts of the Stand With Crypto organization representing the U.S. cryptocurrency owners to advocate clear, common sense regulation for the cryptocurrency industry.We implore you to support the CLARITY Act to unlock the potential of the cryptocurrency industry.
4. How do industry insiders evaluate the bill?
Agree
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Former SEC commissioner Elad Roisman:The bill is“An important step in providing the required clarity” to the digital market.
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Former CFTC Chairman Rostin Behnam:Agree to the regulatory loopholes in existing federal laws andUrge Congress to fill this gap by passing “targeted legislation.”
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Ji Kim, Chairman and Acting CEO of Cryptocurrency Innovation Committee:The CLARITY Act is an important step towards clarifying encryption rules, the rule defines the role of SEC and CFTC, protects self-custody and protects consumers’ rights.
be opposed to
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Former Commodity Futures Trading Commission Chairman Timothy Massad raised major concerns, especially regarding the anti-money laundering clause.”We have to provide enough tools for the Ministry of Finance and other regulators to deal with these risks. But I don’t think we have done that yet.” When asked directlyWhen the bill fully resolves the anti-money laundering problem, Massad replied that “not enough”, and pointed out key vulnerabilities:
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The bill only applies to the Bank Secrecy Act requirements of centralized intermediaries;
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Crypto assets can be transferred without intermediary, causing law enforcement loopholes;
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The Ministry of Finance needs more power over decentralized agreements and foreign platforms;
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Stablecoin issuers should be asked to monitor suspicious wallet activity.
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House Financial Services Committee Democratic leader Maxine Waters criticized the bill for being hasty and irresponsible, warning that it would weaken regulation of high-risk digital asset activity and open the door to potential abuse.Waters also expressed concerns about the growing entanglement between Donald Trump’s economic interests and federal cryptocurrency policy.She called the bill “Trump’s cryptocurrency scam” and noted that the president’s growing influence in the digital asset space, including trading platforms, stablecoins, mining companies, NFTs and other token investments, which are estimated to bring at least $620 million in revenue.
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U.S. Senator Elizabeth Warren warned:The bill may allow “non-crypto companies” to circumvent the Securities and Exchange Commission (SEC) regulation through asset tokenization.According to this House of Representatives bill, listed companies like Meta or Tesla can completely get rid of SEC regulations by simply putting their own stocks on the blockchain.
V. Conclusion
The CLARITY Act is another bill that attracts industry attention after the GENIUS Act. If the bill is finally passed, it will surely benefit the long-term development prospects of the cryptocurrency industry and boost the crypto market in the short term.However, it is still necessary to pay attention to specific issues such as the distribution of power and “maturity” judgment of the US SEC and CFTC in cryptocurrency regulation.If the two regulatory authorities cooperate well, it will promote the innovative development of the US cryptocurrency industry and attract more traditional financial giants to enter the cryptocurrency field.However, if there is regulatory friction between the two, the industry will continue to face regulatory chaos.
For the United States, this is a turning point in the development of the cryptocurrency industry; for the global cryptocurrency industry, this is an attempt full of opportunities and challenges. Whether it is successful or failed, it will become a valuable asset for regulators.
For the content of the GENIUS Act, click:“GENIUS Bill passed by the U.S. Senate What impact does it have on the crypto industry?”
