Crypto news this week has been highlighting the shifting landscape, especially in terms of regulation.
While it mainly focused on stablecoin regulation, the U.S. is swiftly moving towards creating regulations to govern the broader crypto market.
The U.S., for the longest time under the previous SEC, painted digital assets in a negative light. This was because the U.S. government, along with other governments across the world, initially saw cryptocurrencies as a threat.
The current U.S. administration is pro-crypto and has been rapidly moving towards introducing proper regulation for the crypto market.
The recently introduced Clarity Act aims to achieve just that, and Trump’s Crypto Czar expressed optimism about it during a recent interview.
Source: X
David Sacks noted that the Clarity Act could provide a key regulatory framework for the crypto market for the next 2 decades. He also revealed that he was optimistic about the Clarity Act bill being passed into law.
Why the Clarity Act is Making Crypto News Headlines?
Trump and his administration have been clear on their stance regarding cryptocurrencies. However, this also calls for proper frameworks to outline the limits of crypto-related operations in the country.
U.S. Congressman French Hill, the current acting chairman of the House Financial Services Committee, introduced the Clarity Act at the end of May.
The goal of the legislation was to provide the CFTC and the SEC with clearly defined oversight guidelines.
This includes user protection and compliance standards aimed at guiding the market toward maturity.
The U.S. government’s efforts with the Clarity Act may likely influence other foreign governments to adopt similar strategies.
In fact, many will likely use the Clarity Act as a benchmark for their own crypto regulatory frameworks.
But what does this all mean for the crypto market? Analysts expect regulatory clarity to pave the way for more institutional involvement in the segment. For digital assets, that outcome could translate to more liquidity inflows.
The broader picture highlights potential developments that may lead to crypto becoming a bigger part of the financial system.
Some even see the U.S. government’s regulatory efforts as part of a plan to seal the cracks in the traditional financial system.
Clarity Act Makes Efforts Towards Becoming Law
The Clarity Act offers a rough idea of where the U.S. is at in its efforts towards becoming the leading country in terms of crypto adoption. But just how fast has the U.S. been moving in its regulatory clarity journey?
According to a U.S. government tracker, the bill concluded the introduction phase and was awaiting the completion of the next stage, which is a green light by House committees.
Recent updates revealed that the House Financial Services Committee and the House Agriculture Committee recently nodded in favor of the Clarity Act. This means the House floor will soon vote on the bill.
Source: X
If the House floor votes in favor of the bill, then it will make its way to the Senate, before landing on the President’s desk.
What’s interesting is that the House committees moved forward with haste, suggesting that the bill could be enacted into law sooner than expected.
Judging by David Sacks’ comments, it is likely that the bill will make its way into law. It is also worth acknowledging that some analysts expressed concerns over the Clarity Act’s potential to bring forth unfair oversight.
However, part of the bill highlighted plans to implement protections for DeFi users and tools. Those exceptions will reportedly be aimed at protecting against unfair financial overreach.
In other words, it suggests that the U.S. government may deploy a softer stance for the DeFi space, which suggests that the bill will likely support self-custody.