Advocates warn that failing to pass the CLARITY Act could leave the door open for a future, less industry-friendly US government to crack down on crypto policies, according to Peter Van Valkenburgh, executive director of Coin Center.
In a Friday post on X, Van Valkenburgh argued that rejecting protections for developers in legislation like the CLARITY Act and the Blockchain Regulatory Certainty Act in favor of โshort-term business interestsโ could lead to a grim future for the industry.
โThe point of passing CLARITY is not to trust this administration. It is to bind the next one,โ he said, adding that โA world without CLARITYโs statutory protections for developers is a world governed by prosecutorial discretion, political fashion, and fear.โ
The CLARITY Act stalled in the Senate after banks, crypto firms, and lawmakers failed to agree on key provisions โ including whether to allow stablecoin yields. The bill covers a range of measures, including frameworks for registering crypto intermediaries, regulating digital assets and classifying tokens.
During the previous administration, former SEC Chair Gary Gensler drew heavy criticism from the crypto industry for allegedly crafting policy through enforcement actions and legal settlements with crypto firms rather than formal rulemaking.
Nothing set in stone without legislation
Van Valkenburgh also predicts that, without legislative clarity, a future administrationโs Department of Justice could ramp up prosecutions of privacy-tool developers as unlicensed money transmitters, and that existing regulatory interpretive guidance could be revoked.
Related: Crypto investor sentiment will rise once CLARITY Act is passed: Bessent
Since Gensler resigned on Jan. 20, 2025, crypto proponents have noted a regulatory shift by the SEC, including the dismissal of several long-running enforcement actions against crypto firms and friendlier guidance on how the agency will treat crypto.
โIf we lose this moment because we thought weโd have a bit more revenue and a bit more latitude under the short-term friendly discretion of the current administration, then we lose our way,โ Van Valkenburgh said, urging supporters to press for statutory protections that withstand political change.
