United States Towards Clear Regulation for Cryptocurrency Market: Digital Asset Market Clarity Act Presented
Digital Asset Market Clarity Act: A Republican-Led Initiative
The proposal , backed by top Republicans on the House Finance and Agriculture committees, represents Congress’s second major initiative to regulate the cryptocurrency sector .
The new bill is the successor to the previous Financial Innovation and Technology for the 21st Century Act (FIT21) and aims to address the broader and more complex issue of market structure , compared to stablecoin regulation , which nevertheless remains more advanced in the legislative path.
According to Representative Dusty Johnson , Republican of South Dakota and chairman of the Agriculture Subcommittee on Digital Assets, “America should be the global leader in the digital asset market, but we can’t be that without a clear regulatory framework.”
The Central Role of the Commodity Futures Trading Commission
One of the key elements of the 236-page Clarity Act is the granting of a leading role to the Commodity Futures Trading Commission ( CFTC ). The agency would gain exclusive jurisdiction over the spot or cash markets for digital commodities , which account for the majority of crypto activity in the current view of U.S. regulators.
The bill provides a system where crypto platforms can register with the CFTC or the Securities and Exchange Commission ( SEC ), depending on the type of asset they trade: digital commodities like Bitcoin or financial securities. Entities that want to register as digital commodities exchanges, brokers, or dealers will be able to obtain provisional registrations while the CFTC works to develop final rules.
New rules for platforms and asset custody
The Clarity Act requires crypto platforms to be regulated as financial institutions under the Bank Secrecy Act . It also exempts certain decentralized finance ( DeFi ) operations and wallet providers from SEC oversight. Another notable point is the prohibition on regulators requiring custodians to hold client assets on their balance sheets, a proposal previously floated by SEC staff but later abandoned.
The bill also assigns some authority over payment stablecoins — which are explicitly defined as non-securities — to the regulator already responsible for the company involved in the activity. This approach is intended to avoid overlap and conflict between federal agencies.
Another issue addressed in the Clarity Act concerns so-called qualified custodians of digital assets , a controversial issue after the SEC sought to limit the custody of customer assets to a narrow group of regulated entities. The new bill requires that a qualified custodian be subject to “adequate supervision and appropriate regulation” by federal, state, or foreign regulators. The CFTC will set the specific standards.
DeFi and NFT: Study and Report Within a Year
For DeFi, the Clarity Act postpones direct regulation, instead requiring the SEC, CFTC, and the Department of the Treasury to conduct a thorough study and report within a year. The Government Accountability Office (GAO) will also be tasked with conducting an analysis of DeFi and non-fungible tokens ( NFTs ).
Timings and legislative challenges
If passed, the law would give regulators a year to implement new market structure rules. However, that is an ambitious deadline given the complexity of financial regulation. Previous experiences, such as the 2010 Dodd-Frank Act , show that some provisions can take years to fully implement.
Meanwhile, the Senate will return to debate its own stablecoin bill next week , which has already cleared several procedural hurdles with some bipartisan consensus. However, there are still strong reservations from Democrats, particularly over President Donald Trump ’s personal ties to the crypto sector, which his administration is seeking to regulate.
Towards a unified legislative strategy?
There remains debate over whether the stablecoin bill and the market structure bill could be merged into one big cryptocurrency legislative initiative. President Trump has expressed a desire to have both bills on his desk by Congress’s summer recess in August, but many industry experts in Washington consider that timeline to be extremely optimistic.
The House committees will hold a series of public hearings on digital assets next week, giving lawmakers the opportunity to discuss the Clarity Act in detail and engage with industry experts and stakeholders.
In short , the Digital Asset Market Clarity Act represents a concrete step towards clearer and more structured regulation of the US crypto market. With an approach that balances innovation and oversight, the bill could mark a turning point for the entire digital ecosystem, laying the foundation for American leadership in the digital assets sector.
