House Democrats expressed concerns over the CLARITY Act during a recent hearing, emphasizing the potential regulatory gaps that could negatively affect the U.S. securities market. The bill aims to establish a legal framework for digital assets but might inadvertently enable traditional finance firms to sidestep regulations. Amanda Fischer, Policy Director at Better Markets, highlighted that the Act’s loopholes could lead firms to use blockchain for capital raising while avoiding SEC oversight. Furthermore, many crypto tokens would be classified as ‘digital commodities’, thus exempt from SEC regulation, raising fears that token issuers would exploit these classifications rather than comply with stricter SEC requirements. The hearing underscored the broader implications of the legislation, suggesting that its effects would extend beyond the crypto sector, potentially reshaping regulatory norms across financial markets.

Source 🔗