Congress Introduces CLARITY Act Shifting Crypto Oversight to CFTC

The bipartisan Digital Asset Market Clarity (CLARITY) Act, introduced by House Financial Services Committee Chairman French Hill and co-sponsored by members across both parties, aims to redefine the regulatory framework for digital assets in the United States. The bill proposes transferring most cryptocurrency oversight from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC), classifying widely traded tokens like Bitcoin, Ethereum, Solana, Cardano, XRP, and Dogecoin as "digital commodities." It introduces a voluntary "mature blockchain system" designation for decentralized, open-source blockchains with limited token concentration, providing a clearer standard to distinguish reputable projects. The legislation intends to provide long-overdue regulatory clarity, promoting consumer protection, innovation, and U.S. competitiveness, while reducing risks such as scams and fraud in the crypto space. Additionally, the SEC updated its guidance on cryptocurrency staking, clarifying that various staking activities are not securities, marking a shift from prior stances. The bill has garnered bipartisan support and is viewed as a critical step to foster growth, protect investors, and position the U.S. as a global leader in digital assets.