On May 29, 2025, Chairman French Hill introduced the CLARITY Act, raising concerns for Coinbase's Karaca Calvert due to its high disclosure thresholds. These requirements could potentially drive cryptocurrency projects out of the United States, impacting crypto listings, issuance, and international competitiveness, especially for early-stage developers who face significant compliance expenses.
Coinbase's Concerns Over the CLARITY Act
Karaca Calvert, Head of U.S. Policy at Coinbase, has voiced serious concerns regarding the CLARITY Act's disclosure thresholds, noting they are significantly higher than global standards. She warned that these stringent requirements might discourage American innovation in the cryptocurrency space.
French Hill introduced the CLARITY Act of 2025, which aims to grant the Commodity Futures Trading Commission (CFTC) exclusive jurisdiction over digital commodity markets. Coinbase's critique focuses on the potential harm this legislation could inflict on domestic innovation due to the increased compliance costs associated with the proposed framework.
Calvert stated, "The suggested framework would put off American crypto innovation. Disclosure requirements are much higher than those under MiCA in Europe."
Impact on Crypto Projects and Developers
The compliance requirements outlined in the CLARITY Act are expected to significantly impact early-stage developers. Coinbase suggests these measures could compel cryptocurrency projects to relocate abroad.
The North American Securities Administrators Association (NASAA) has also warned of potential legal ambiguities that the Act could create, which might stifle market development. NASAA emphasizes the necessity for balanced regulatory frameworks that support growth within the digital asset sector.
Experts in the field highlight that treating assets without ownership rights as commodities under the CFTC's jurisdiction would align more closely with current business models. This legislation has broad implications for the issuance of crypto assets, public sales, and overall market entry for new projects.
Senate Discussions and Future Legislation
Building upon this legislative groundwork, Senators Tim Scott and Cynthia Lummis have introduced a discussion draft in the Senate. While the intention is to enhance regulatory oversight, concerns remain that the CLARITY Act might inadvertently restrict technological growth.
Financial stakeholders have expressed apprehension regarding the potential for this legislation to stifle market development. Senators are actively discussing a framework for the digital asset market structure, underscoring the importance of creating actionable regulatory frameworks that do not impede innovation.