Clarity Act, we hardly knew ye: We look at what was in the bill and what's replacing it
The Digital Asset Market Clarity Act, a proposed U.S. congressional bill, aimed to define different types of cryptocurrencies and clarify regulatory oversight, particularly between the SEC and CFTC. It sought to grant the CFTC supervisory powers over crypto commodity spot markets and offer limited legal protections to DeFi developers.
Why it matters
This legislation was crucial for bringing regulatory clarity to the U.S. crypto market, which has long suffered from ambiguity and inter-agency disputes, impacting innovation and investor protection.
The Digital Asset Market Clarity Act was Congress' umpteenth version of a similar concept that's made the rounds for years: to define the different kinds of cryptocurrencies and related assets, and say exactly which regulators have power over them.
For much of the industry's history in the U.S., it battled with agencies such as the U.S. Securities and Exchange Commission over what platforms like Coinbase and Kraken were allowed to do and whether issuing crypto was legally the same as launching a security. It got heated, and there were a lot of enforcement actions, expensive settlements and drama, much of it starring former SEC Chair Gary Gensler. (Pausing for crypto insiders to boo and hiss.)
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