The U.S. Senate Banking Committee clarifies 7 misconceptions about the CLARITY Act: it does not deviate from securities law and emphasizes investor protection and regulatory boundaries

The U.S. Senate Banking Committee published an article interpreting and clarifying seven major misconceptions about the CLARITY Act, which mainly include:

1. It does not deviate from existing securities laws but is based on established securities law principles, clearly defining which digital assets are securities and which are commodities.
2. The act is essentially an investor protection measure, aimed at combating fraud, manipulation, and abuse by establishing clear rules, with the goal of preventing a recurrence of risks similar to those seen with FTX.
3. By clearly delineating the regulatory authority of the SEC and CFTC and establishing a joint advisory committee to coordinate rules, it addresses regulatory gaps while introducing targeted anti-avoidance provisions to reduce arbitrage opportunities.
4. It requires key intermediaries to fulfill anti-money laundering and anti-terrorist financing obligations and strengthens compliance with sanctions and enforcement authority for the Treasury.
5. It does not allow DeFi to become a conduit for illegal funds, emphasizing "precise strikes against illegal activities," requiring centralized intermediaries interacting with DeFi protocols to implement risk management standards, while also establishing specific rules for intermediaries that are not truly decentralized to protect the code and innovation itself.
6. It clearly protects the self-custody rights of software developers and users, not considering developers who do not control user funds and only publish or maintain code as financial intermediaries, while retaining the ability for regulatory agencies to intervene in response to real risks.
7. The core goal is to strengthen national security, protect investors, and promote compliant innovation under clear rules, rather than being "tailored" for specific industries.