- New bipartisan bill, the CLARITY Act, introduced by the House Financial Services Committee aims to regulate digital assets.
- The draft law assigns primary oversight to the Commodity Futures Trading Commission (CFTC), with some joint rulemaking with the Securities and Exchange Commission (SEC).
- A key feature is the bill’s focus on defining “digital commodities,” excluding several asset types like securities, stablecoins, and pooled investments.
- The act may prompt more projects to launch their own blockchains to benefit from lighter regulations.
- Secondary sales of digital commodities would not be treated as investment contracts under securities law.
House Financial Services Committee Chair French Hill introduced the bipartisan Digital Asset Market Clarity (CLARITY) Act, a new bill aimed at setting rules for digital asset markets. The legislation was announced yesterday and developed with support from the House Committee on Agriculture. Five Republicans and three Democrats back the proposal.
The CLARITY Act would give the main regulatory role to the CFTC, while some rulemaking would take place jointly with the SEC. “I am proud to introduce the bipartisan CLARITY Act with my colleagues. Our bill brings long-overdue clarity to the digital asset ecosystem, prioritizes consumer protection and American innovation, and builds off our work in the 118th Congress,” said Chairman Hill. This refers to past efforts, such as the FIT 21 bill, which passed the House but not the Senate.
The new regulations would expand the CFTC’s duties. Traditionally focused on commodities and derivatives, the agency will now oversee a broader range of digital assets, especially those with a large number of retail participants. This comes at a time when all four current CFTC commissioners plan to step down, though Acting Chair Pham will remain until the next nominee, Brian Quintenz, is confirmed.
A core part of the bill is the definition of “digital commodity.” It describes these as tokens closely linked to a blockchain, which excludes “non-native tokens” such as those used in trading or lending protocols. These non-native tokens may be treated as securities, facing stricter regulations as a result. Some analysts note this could encourage creators to launch their own blockchains, which could lead to more—and possibly unnecessary—blockchain networks.
The bill specifically excludes certain asset types from being defined as digital commodities. These exclusions cover securities, securities derivatives, stablecoins, bank deposits, traditional commodities, commodity derivatives, pooled investment vehicles, collectibles, and other non-commodity goods.
The act also addresses the definition of “investment contracts” using the “Howey test,” which determines when a transaction is considered an investment contract under U.S. law. The new text aims to clarify that digital commodities themselves, when sold in most secondary market transactions, are not considered investment contracts.
To prevent concentration, primary sales of digital commodities from established (“mature”) blockchains—operating for over four years, with annual issuance below $75 million and no single holder with more than 10% of coins—would gain certain exemptions. These rules apply only to U.S.-based issuers.
Further sections require brokers, dealers, and exchanges dealing with digital commodities to register with the CFTC. The bill also ensures that investors have the choice to self-custody their digital assets.
As further detail, some notable crypto projects like Uniswap and Ondo Finance have recently launched their own blockchains, appearing to expand business rather than responding solely to regulatory changes.
For more information, see the Digital Asset Market Clarity (CLARITY) Act.
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