#CryptoClarityAct

What is the CLARITY Act?

Under the CLARITY Act, a blockchain is considered "mature" if it has been operational for years, widely adopted, and not controlled by any individual or company. The core idea is that no entity should own more than 20% of the network's power, management, or influence. Both Bitcoin and Ethereum are clear examples of this, as they involve thousands of independent participants, with no central authority making unilateral decisions.

When a blockchain meets these criteria, it is officially classified as a digital commodity, similar to gold or oil, and is subject to oversight by the Commodity Futures Trading Commission (CFTC). This is important because the commission takes a more flexible and easier regulatory approach compared to the Securities and Exchange Commission (SEC), which treats assets, such as stocks or securities, under stricter rules to protect investors.