- Coin Center‘s executive director warns that failing to pass crypto legislation like the CLARITY Act leaves the industry vulnerable to future regulatory crackdowns.
- The stalled bill aims to create statutory protections for developers, moving beyond reliance on the “goodwill” of any single administration.
- Without clear laws, the industry could revert to governance by “prosecutorial discretion” and shifting political priorities.
- Recent friendlier regulatory guidance is not permanent and could be revoked by a future government.
Peter Van Valkenburgh of advocacy group Coin Center warned on Friday that the U.S. crypto industry faces a precarious future without protective legislation. He argued that prioritizing short-term business interests over laws like the CLARITY Act is a dangerous gamble.
Consequently, the point of such a law is to bind future, potentially hostile administrations. “A world without CLARITY’s statutory protections for developers is a world governed by prosecutorial discretion, political fashion, and fear,” Van Valkenburgh stated.
The CLARITY Act has stalled in the Senate due to disputes over key provisions like stablecoin yields. It sought to establish frameworks for crypto intermediaries and digital asset classification.
Meanwhile, the previous administration saw the SEC under Gary Gensler heavily criticized for regulation-by-enforcement. Van Valkenburgh predicts a future Justice Department could similarly target privacy-tool developers without new laws.
Since Gensler’s resignation, the SEC has adopted a friendlier posture, dismissing some enforcement actions. However, this guidance lacks the permanence of congressional legislation.
“If we lose this moment because we thought we’d have a bit more revenue and a bit more latitude under the short-term friendly discretion of the current administration, then we lose our way,” Van Valkenburgh said. He fears the industry may be handing tools to future officials who would restrict it.
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