#CryptoClarityAct What is the CLARITY Act?

The CLARITY Act (H.R. 3633) was passed by the U.S. House of Representatives on July 17, 2025, and now awaits Senate consideration .

Key features include:

Clear definitions: Digital assets are explicitly categorized as either digital commodities—regulated by the CFTC—or securities, under SEC jurisdiction. This aims to replace subjective regulatory interpretations with objective criteria .

Jurisdictional clarity: Platforms trading digital commodities (e.g. Bitcoin, mature blockchain tokens) would register with the CFTC, while platforms dealing in securities or tokenized assets would be overseen by the SEC .

AML compliance: Crypto intermediaries—including exchanges, brokers, and custodians—would be subject to the Bank Secrecy Act, aligning with traditional financial institution standards .

DeFi exemptions: Decentralized finance protocols that do not function as intermediaries may be excluded from certain intermediary regulations, providing regulatory relief to projects focused on non-custodial services .

Mature‑chain criteria: For an asset to qualify as a “digital commodity,” the underlying blockchain must meet decentralized governance standards (e.g. no single holder controls more than 20% of supply) .

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💡 Why It Matters

Regulatory certainty: By clearly specifying agency jurisdiction and asset classification, the bill reduces ambiguity that has long hindered innovation and investor confidence in crypto .

Consumer protections: AML requirements and defined custody frameworks aim to strengthen investor safeguards.

DeFi innovation: Offers legal breathing room for true decentralized systems to grow without being subject to blanket intermediary regulations.

Potential gaps:

Critics warn the bill may inadvertently codify weaker frameworks than those applied to traditional finance, especially around conflicts of interest and self-dealing in crypto platforms .

State‑level regulation remains unchanged, meaning inconsistent rules may still apply across jurisdictions—even for DeFi services