Interpreting the US CLARITY Act, a significant step towards the clarification of digital asset regulation.

Original | Odaily Daily Report (@OdailyChina)

Author｜Golem（@web3_golem）

The U.S. digital asset market clarity bill, the "CLARITY Act," passed the U.S. House Agriculture Committee and the Financial Services Committee with votes of 47 to 6 and 32 to 19, respectively, and is set to be submitted to the House for a full vote.

The full name of the CLARITY Act is "Digital Asset Market Clarity Act of 2025", which translates to the Digital Asset Market Clarity Act, which was submitted by Republican Representative J. French Hill of Arkansas, aiming to establish a clear and unified regulatory framework for the U.S. digital asset (cryptoasset) market, and clarify the division of responsibilities between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) in the field of digital assets. While protecting investors and fighting fraud, leave room for exemptions and research for innovation (DeFi, stablecoins, NFTs, etc.).

The bill was previously stalled in the House due to controversy over "Trump's involvement in cryptocurrency activities potentially causing conflicts of interest," but on June 12, the latest amendment to the bill "prohibiting President Trump and his family from profiting from the trading or promotion of cryptocurrency assets" was rejected. U.S. House Financial Services Committee and Agriculture Committee Chair Thompson stated, "This is not the place to discuss the president's ethics," allowing the review to continue.

The Odaily Daily Report will mainly outline the key content of the "CLARITY Act" bill (with the help of ChatGPT) in this article and analyze the subsequent impact on the cryptocurrency market.

Main Content of the CLARITY Act

The impact of security incidents on crypto and financial markets, from the bankruptcy of the Mt. Gox exchange in 2013 to the collapse of FTX in 2022, as well as the frequent and protracted legal disputes between crypto projects such as the SEC and Ripple, have highlighted the ambiguity of the definitions of "securities" and "commodities." At the same time, both the SEC and the CFTC have partial regulatory authority over digital assets, but there are overlaps and conflicts between the two in terms of definitions, enforcement standards, and even market access. Therefore, the creation of the CLARITY Act can clearly delineate the responsibilities of the two regulators and avoid regulatory confusion.

The CLARITY Act is mainly divided into five parts, covering the entire process from definitions, transactions to regulation and innovation support.

Title I: Definition and Rule Making

Chapter 1 mainly revises the Securities Act of 1933, the Exchange Act of 1934 and the Commodity Exchange Act to clearly define the core concepts of "blockchain", "blockchain applications/protocols/systems", "decentralized governance systems", "digital assets", "digital commodities" and related market participants (issuers, related persons, related persons); The SEC and CFTC are required to complete the development of supporting rules within the specified time limit, and establish a provisional registration system for digital commodity exchanges, brokers, and dealers.

The definition of digital commodities here is the same as the meaning assigned to the term in Section 1a of the Commodity Exchange Act. The definition of digital commodities in Section 1a of the Commodity Exchange Act is as follows:

"Digital assets that are inherently associated with the blockchain system—namely, those digital assets that are directly utilized for or derived from the functions or operations of the blockchain system, or used for the services provided by that system—and whose value is derived from or expected to be derived from the use of that blockchain system."

At the same time, it is clearly stated that payment-based stablecoins like USDT, USDC, securities tokens, and other non-speculative assets such as artworks, game items, and virtual land do not fall under the category of "digital goods."

Title II: The Issuance and Sale of Digital Goods

Chapter Two mainly identifies "investment contract type assets," establishes exemption conditions for primary issuance and secondary market trading, and stipulates requirements for mature blockchain systems, etc. It also clarifies that these regulations will take effect 360 days after the signing of the bill.

The Act recognizes a digital commodity as an "investment contract asset" if it satisfies the peer-to-peer independent transfer requirement and is sold under an investment contract. In other words, all digital commodities sold in accordance with the investment contract within the meaning of the Securities Law in the capital raising process are classified as "investment contract assets" in the transaction link; When these assets are resold in the secondary market by non-issuers (or their agents/underwriters), they no longer constitute investment contracts (i.e., securities laws are no longer applicable) and only retain their status as "digital commodities".

At the same time, the exemption conditions for primary issuance and secondary market transactions are also clarified. Eligibility for the primary offering of digital commodities is limited to issuers of digital commodities,** up to $75 million in any consecutive 12-month period, and issuers are required to file disclosure documents with the SEC prior to the offering and obtain an effective or confirmation letter before proceeding with the offering. **

The secondary market trading exemption mainly targets digital goods that were originally issued through investment contracts and transferred in the secondary market. As long as the secondary transfer does not involve the original issuer or any entity controlled by it, this action is no longer considered an "offer or sale" of the original investment contract and is not subject to the securities trading regulations of the Securities Act of 1933.

Title III: Intermediary Registration under the SEC

Chapter 3 mainly incorporates "licensed payment stablecoins" and digital goods into the SEC's anti-fraud enforcement scope; at the same time, it sets targeted exemptions for DeFi activities and conducts research on topics such as bank custody, broker/dealer disclosures, and foreign counterparty participation.

On June 9, under a joint statement by 10 organizations including Paradigm, Uniswap Labs, and Jump, the Blockchain Regulatory Certainty Act (BRCA) was incorporated into the latest version of the CLARITY Act, specifically reflected in the targeted exemption provisions for decentralized finance (DeFi) and blockchain developers.

Any activities that are directly or indirectly engaged in the following operations related to blockchain systems or DeFi trading protocols are not subject to Section 15H of the Securities Exchange Act and its derivative rules (but are still subject to anti-fraud/anti-manipulation provisions):

• Network Transaction Processing: compiling, forwarding, retrieving, sorting, and validating network transactions or similar functions.
• Node & Compute Services: Provides computing power, running nodes/oracles, bandwidth, or other similar ancillary services.
• User Interface: Provides a front-end interface for users to query and access blockchain data.
• Protocol and Messaging System Maintenance: Develop, publish, manage, maintain or distribute blockchain systems, DeFi trading protocols or DeFi messaging systems.
• Liquidity Pool Participation: Run or participate in a liquidity pool to execute spot buying and selling of digital commodities.
• Non-custodial wallets and key management: Creating or distributing wallet software or other tools that only assist individuals in "self" custody and safeguarding digital assets or private keys.

Title IV: Intermediary Registration under CFTC

Chapter 4 clarifies the CFTC's exclusive regulatory authority over the spot market for digital commodities; require futures firms to use qualified digital asset custodians; In addition, it is necessary to establish a trading certification and registration mechanism for exchanges, brokers, and dealers; Set rules for Commodity Pool Operators (CPOs) and Commodity Trading Advisors (CTAs); and incorporated into the congressional position statement.

This bill expands the registration obligations of CPO/CTA to the digital goods sector and establishes a strict requirement that one cannot practice without registration. At the same time, it authorizes the CFTC to formulate rules for "conditional exemptions" for CPO/CTA to alleviate redundant, conflicting, or overly burdensome compliance requirements and promote innovation.

At the end of this chapter, there is a statement of the position of Congress, indicating that this law and any amendments do not grant any federal or state regulatory agency the power to regulate commodities other than "digital goods" in the spot market, thus preventing regulatory agencies from expansively using this law to regulate traditional commodity spot trading such as oil, agricultural products, etc.

Title V: Innovation and Technical Support

Chapter V sets out Congress's proactive stance on digital asset innovation and establishes a "Center for Fintech and Innovation Strategy" within 180 days of the enactment of this Act; Legalize the CFTC Lab (LabCFTC) to conduct research on DeFi, NFTs, blockchain payment systems, market infrastructure, financial literacy, and more.

This chapter indicates that a CFTC laboratory (LabCFTC) will be established within the Commission, with a director appointed by the Commission and subject to its authority. Starting from 2025, LabCFTC must submit its activity report to the House Committee on Agriculture and the Senate Committee on Agriculture, Nutrition, and Forestry by October 31 of each year.

Possible Impacts Ahead

The CLARITY Act has now been submitted to the House of Representatives for a full vote, and based on the number of votes considered and passed by the House Agriculture Committee and the Financial Services Committee, the probability of the bill being passed by the full House vote is about 65%.

To sum up, the passage of the CLARITY Act is beneficial to the entire crypto industry, firstly, by clarifying the division of jurisdiction between the SEC and the CFTC, it is conducive to changing the chaotic situation of crypto supervision, and also clarifying the regulatory boundaries of crypto activities, so that crypto practitioners have a legal basis when engaging in crypto business activities; Second, the bill also promotes the development of the crypto industry through policy measures, such as the establishment of the Fintech and Innovation Strategy Center and the CFTC Lab, which also means that the regulation has changed from "management" to "introduction", using its own advantages to actively guide the development of the crypto industry in the United States in a more compliant direction.

However, some critics believe that the bill may encourage venture capital or weaken the securities laws governing cryptocurrency.

Supporters and critics have their own arguments, and we await to see whether the "CLARITY Act" bill will ultimately pass and whether it can bring substantial benefits to the cryptocurrency industry.