Revised CLARITY Act Sets Rules for Controlled DeFi
Reported by Cointelegraph · AI-assisted summary by ChikoCorp AI News Desk
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Summary
A revised CLARITY Act proposed in the US would require regulators to determine if controllers of “non-decentralized finance trading protocols” comply with securities, commodities, and anti-money laundering laws. The bill, posted on Senator Cynthia Lummis’ website, defines such protocols as those whose rules can be materially changed by individuals or groups and whose transactions lack full transparency. The SEC and CFTC would create rules on registration and conduct, while the Treasury would clarify Bank Secrecy Act obligations for these controllers.
Why it matters
The source highlights the bill as a pivotal moment for digital assets and innovation in the US, aiming to balance consumer protection with business standards. The legislation has garnered support from key industry figures, including Coinbase CEO Brian Armstrong, who sees it as ready for passage, though some ethical and stablecoin-related disputes remain unresolved. If the bill does not pass, regulators might pursue rulemaking using existing authority.
Key context
The bill follows ongoing discussions about regulating DeFi protocols and their controllers to address concerns around control transparency, ethics, and anti-money laundering. A Senate procedural vote is scheduled for September 15 and requires 60 votes, necessitating bipartisan support amid persistent disagreements over ethics and stablecoin rewards. The legislation clarifies that software and distributed ledger systems themselves would not need to register.
Key numbers and entities
Senator Cynthia Lummis (bill poster), Crypto Council for Innovation CEO Ji Hun Kim, Coinbase CEO Brian Armstrong, Democratic Senator Ruben Gallego. The Senate procedural vote is scheduled for September 15 and requires 60 votes to advance.
What remains unclear
The source does not specify which “must-have issues” raised by Coinbase were resolved or the precise details of the ongoing ethics and stablecoin yield disputes. It also remains uncertain whether the bill will achieve the necessary bipartisan support to pass.