17 State Attorneys General Target Senate Crypto Bill
A bipartisan coalition of state attorneys general from 17 states and the District of Columbia is opposing the latest iteration of the Clarity Act, according to a report by The Daily Hodl. The officials sent a letter to Senate Banking Committee Chairman Tim Scott arguing that the proposed crypto market structure legislation fails to provide adequate protections against fraud and scams for digital asset investors.
According to the prosecutors, while the current draft of the bill reserves certain powers for states to prosecute fraud, the statutory language remains ambiguous and restricted. They warned that these unclear provisions create opportunities to challenge state police powers, potentially depriving states of their ability to combat financial crimes. The officials noted that legal delays caused by statutory ambiguity ultimately benefit bad actors in the cryptocurrency sector.
The legislative push follows the release of a revised version of the Clarity Act by U.S. Senate Banking Digital Assets Subcommittee Chair Cynthia Lummis. The updated text incorporates ethics provisions barring federal elected officials, senior executive branch employees, and federal judges from issuing digital assets or maintaining significant financial interests in crypto asset issuers. The legislation also places regulatory oversight of most digital assets under the Commodity Futures Trading Commission rather than the Securities and Exchange Commission.
The Senate is scheduled to hold a procedural vote requiring 60 votes to allow actual floor debate and consideration of the bill. Traditional financial institutions and banking associations have also voiced opposition, warning that the current framework could pose systemic financial stability risks and draw bank deposits away into stablecoins. Meanwhile, prediction markets indicate that confidence in the passage of the legislation this year has ticked upward slightly ahead of the vote.
Based on reporting by dailyhodl.com.
