French Hill Introduces Bill to Bring Regulatory Clarity to Digital Assets
House Financial Services Committee Chairman French Hill of Arkansas introduced a bill Thursday (May 29) that would establish a regulatory framework for digital assets in the United States.
The Digital Asset Market Clarity (CLARITY) Act is co-sponsored by eight other members of Congress — five Republicans and three Democrats, according to the committee’s Thursday press release.
“Our bill brings long-overdue clarity to the digital asset ecosystem, prioritizes consumer protection and American innovation, and builds off our work in the 118th Congress,” Hill said in the release. “I look forward to delivering our bill to President [Donald] Trump’s desk and securing America’s position as the global leader in digital assets.”
The CLARITY Act will protect consumers by requiring developers and customer-facing digital asset firms to provide relevant disclosures to customers, and by requiring the digital asset firms to segregate customer funds from their own and address conflicts of interest, according to a one-pager released by the House Financial Services Committee.
It will also foster the development of digital asset projects by giving developers a clear pathway to raise money under the jurisdiction of the Securities and Exchange Commission (SEC) and giving market participants a way to trade digital commodities through intermediaries and exchanges overseen by the Commodity Futures Trading Commission (CFTC), the one-pager said.
To provide clarity to customer-facing digital asset firms, the CLARITY Act will establish clear lines between the SEC and the CFTC and create registration regimes that will permit these firms to lawfully serve customers, per the one-pager.
The introduction of the CLARITY Act came about three weeks after a bipartisan hearing on digital assets that was meant to discuss a Digital Asset Market Structure Discussion Draft, which was introduced into Congress May 5, derailed down partisan lines when many Democratic lawmakers walked out in order to hold their own hearing.
“This decision comes after [Hill] refused to include provisions in legislation blocking Trump’s ability to further enrich himself from crypto,” Maxine Waters of California, ranking member of the House Financial Services Committee, said at the time.
In an earlier hearing, held April 9, attorneys and a crypto executive told lawmakers that securities laws need readjustment to account for some of the unique qualities of digital assets.
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