US Senator argues that vague rules will cause crypto companies to relocate overseas

Senator Cynthia Lummis is advocating for lawmakers to approve the CLARITY Act, which would establish clearer regulations for the industry.

She argued that vague rules have long caused crypto companies to relocate overseas, noting that the proposed crypto legislation would alleviate uncertainty, establish clear rules, strengthen protections, and make the US a global leader.

Insiders said that US lawmakers would review the CLARITY Act on January 15. If the markup goes through favorably, however, it would imply that lawmakers believe the bill will have sufficient support to pass a formal committee vote.

At the same time, the push for clearer crypto rules comes as the United States grapples with a rapidly expanding national debt, which has climbed above $38 trillion, intensifying scrutiny of the country’s long-term fiscal outlook.

Rising interest costs and persistent deficits have renewed interest among policymakers and investors in alternative financial technologies that could improve market efficiency and capital formation.

John D’Agostino believes the bill will be enacted soon

Speaking on the bill, Lummis urged legislators on X: “Our market structure legislation changes that by establishing clear jurisdiction, strong protections, and ensuring America leads the way. Let’s get this done!”

In their review, legislators will be examining where DeFi aligns with federal law. They will also explore how to better distinguish between the SEC and CFTC’s roles in regulating digital assets. 

John D’Agostino, the Institutional Head of Strategy at Coinbase, says the bill is already on the path to progress, and he remains optimistic about its steady improvement, despite frustration from the crypto sector.

He also expects the strategic bill to be passed soon. He addressed the bill’s delay in an interview with CNBC, saying that since the legislation is “fundamental” to crypto and other real asset classes, it is only reasonable that it takes time.

There is a strong chance that the CLARITY Act will be enacted, he added, referring to growing global regulatory momentum and Spain’s forward-leaning initiatives as examples. Spain has already begun passing new cryptocurrency legislation, like the European Union’s Markets in Crypto Assets Regulation (MiCA) and the Directive on Administrative Cooperation (DAC8).

D’Agostino also said that US lawmakers might feel pressured to act swiftly as other nations ramp up their cryptocurrency efforts. He added he hopes the bill can be approved this January.

He also compared the bill to the GENIUS Act, stating that the former is more complex than the latter. But he sees the GENIUS Act as transformative, adding that the passage of the CLARITY Act would be another crucial milestone in the US’s crypto journey ahead.

The CLARITY Act would need 60 votes to move forward

If the Republicans voted as a bloc, the CLARITY Act would likely pass the committee level even without Democratic support. But its eventual passage would be more contentious. After the Senate Agriculture Committee piece is merged, 60 votes will be necessary in the Senate to end debate, hence the importance of cross-party support. 

Tim Scott, the chair of the Banking Committee, spoke to reporters ahead of the recess, saying the conversations with Democrats were fruitful, and some industry players responded cautiously with optimism. 

If the legislation were enacted, this would create rules that regulate the digital asset market in a way that moves beyond long-term, enforcement-driven regulation. It would also clarify which token types are considered securities or commodities, explain how exchanges and brokers can register, and enable regulators to exert more control over spot crypto.

Supporters also said the changes would provide regulatory clarity and strengthen consumer protections, as well as America’s standing compared to places with clear frameworks for cryptocurrencies.

Join a premium crypto trading community free for 30 days - normally $100/mo.