CLARITY Act Faces Split as 2 Major Crypto Camps Clash Over U.S. Rules
A pretty clear split is developing within the US crypto industry over the proposed Clarity Act , a market structure bill designed...
Quick overview
- The proposed Clarity Act is causing a divide in the US crypto industry, with some leaders advocating for its passage while others warn it may hinder innovation.
- The Senate Banking Committee has postponed discussions on the bill due to industry concerns, intensifying the debate over regulatory clarity versus potential drawbacks.
- Supporters argue that the bill could provide essential legal clarity and encourage institutional involvement, while critics, including Coinbase's CEO, fear it may negatively impact key aspects of the crypto ecosystem.
- The ongoing discussions highlight the need for a balanced approach to regulation that fosters innovation while providing necessary oversight.
A pretty clear split is developing within the US crypto industry over the proposed Clarity Act , a market structure bill designed to lay down the law when it comes to how digital assets are regulated. While some industry leaders believe the legislation is long overdue and will bring much-needed clarity, others are warning that in its current form it could actually stifle innovation more than help it.
The bill was all set to go in front of the Senate Banking Committee this week, but lawmakers decided to push the session back amidst growing concerns from the industry. The delay has only added fuel to the fire, with crypto executives clashing over whether imperfect regulation is better than the unknown.
Chris Dixon, managing director at a16z Crypto, has been vocal in his support for pushing the bill forward. He reckons that clear set of rules is essential for builders and entrepreneurs, pointing out that the bipartisan effort we’ve seen over the last five years was all about protecting decentralization and nurturing innovation. Even with some major flaws in the current draft, Dixon thinks we need to get the bill moving if the US wants to stay a global hub for crypto development.
Regulation Has Its Advantages – At Least, That’s What Some Claim
A bunch of policy-focused crypto advocates have echoed Dixon’s cautious optimism. Peter Van Valkenburgh, head of Coin Center, is still pretty upbeat about the direction of the current draft, despite the ongoing negotiations.
CLARITY’s Tradeoff
– Supporters say clearer SEC vs. CFTC lines could unlock institutional money and reduce regulatory surprise.
– Critics point to a key tradeoff: the draft bars passive interest for simply holding payment stablecoins.
If rules bring scale, what freedom are you… https://t.co/zDj4EK1Twi
— Kai – Briefing Block (@briefing_block_) January 15, 2026
The bill’s supporters are adamant that the U.S has already paid a price for not having a clear regulatory framework – we’ve lost talent and capital, they say. And they reckon that even if the progress is glacial, that’s still better than leaving the industry exposed to the whims of enforcement.
Here are the core arguments in favour of the bill:
- Clear rules would help clear up the legal uncertainty for developers and investors
- Market structure legislation could actually encourage institutions to get more involved
- If we delay, we risk pushing innovation offshore
From this perspective, the Clarity Act is seen as a foundation that just needs a bit more work, rather than a complete write-off.
The Coinbase Backing-Out Raises a Big Red Flag
But then there’s Coinbase, the largest US-based exchange, which has withdrawn its support for the bill. CEO Brian Armstrong said he took a good hard look at the Senate Banking Committee’s draft and just didn’t like what he saw. He reckons the bill would leave the industry worse off than we are now, with some provisions that could wreck tokenization, stablecoin innovation, DeFi, and user privacy.
Armstrong praised lawmakers for trying to find common ground, but said the bill just has too many issues to support in its current state. And he’s not alone – Ryan Rasmussen, head of research at Bitwise Invest, warns that the draft could actually damage pretty much all the major parts of the crypto ecosystem.
Crypto attorney Jake Chervinsky has taken a slightly more measured tone, saying that the bill is far from over and can still be improved. And he’s right – we’ve still got the markup and Senate floor process to get through before it even becomes law.
The Clarity Act has become a test case for how – and how fast – the US crypto industry should be regulated.
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