[Crosscheck 4] News revision

The U.S. Senate Banking Committee has formally explained the purpose and key issues of the CLARITY bill, which would overhaul the regulatory framework for the broader crypto-asset market.

In a statement posted through its official channels on the 13th (local time), the committee said the CLARITY (CLARITY) bill on crypto market structure was crafted after months of bipartisan negotiations and discussions with regulators, law enforcement, academia and the industry. The committee said it plans to move to a markup process for the bill in the near future.

The committee noted that the digital-asset market is currently operating under a fragmented supervisory regime and outdated rules. It said the CLARITY bill aims to establish clear and enforceable regulatory standards with the goals of investor protection, attracting innovation to the U.S., and strengthening national security.

The bill, based on existing securities-law principles, clearly distinguishes between securities and commodities among digital assets. Digital assets deemed securities would be subject to the Securities and Exchange Commission’s (SEC) disclosure requirements, resale restrictions and anti-fraud provisions, while the SEC’s enforcement authority would be preserved. The committee said claims that investor protection would be weakened are not true.

It also rejected criticism regarding risks to the financial system. The committee said the CLARITY bill focuses on preventing a repeat of the FTX collapse by establishing a regulatory framework to punish fraud, price manipulation and market abuse. It argued that the absence of regulation poses greater risks to investors and the financial system.

On jurisdiction, the bill specifies a clear division of roles between the SEC and the Commodity Futures Trading Commission (CFTC) and calls for a joint advisory committee to block regulatory gaps and avoidance. On illicit finance and national security, it would strengthen anti-money-laundering, counter-terrorist financing and sanctions compliance, and grant the Treasury Department authority to respond to high-risk overseas activities.

Regarding decentralized finance, it sets out an approach that targets illegal conduct while protecting lawful software development and innovation. It said developers who do not control customer funds would not be treated as financial intermediaries, and the bill would not ban self-custody wallets or criminalize developers.

The committee also drew a line against claims that the CLARITY bill represents industry interests. It stressed that the bill is intended to reduce uncertainty and strengthen enforcement capacity, protecting investors, the financial system and national security at the same time.