CLARITY Act Stalled: A Positive Turn for the Crypto Sector, Says Analyst
CLARITY Act's Stagnation Viewed Positively for Crypto Markets
The delay of the CLARITY crypto market structure bill in the U.S. Congress is seen as advantageous for the crypto industry, per market analyst Michaël van de Poppe. Overregulation could harm markets and undermine decentralized finance (DeFi), he warns.
Concerns Over the Bill
Coinbase recently withdrew its support for the bill, with CEO Brian Armstrong citing issues such as a "de facto ban" on tokenized stocks and government access to DeFi user records. Additionally, the prohibition of yield-bearing stablecoins was highlighted as a concern.
Van de Poppe commented, "If approved as is, the bill could negatively impact markets. The current pause allows continued discussion, reminiscent of the EU's MiCA regulations." MiCA, a comprehensive regulatory framework, underwent extensive revisions before enactment.
Ongoing Negotiations
Negotiations to draft a version of the CLARITY Act satisfactory to both the crypto industry and community banks continue. Armstrong denied reports of tension with the White House, describing the process as "super constructive."
Venture capitalist Nic Carter urged against allowing the prohibition on yield-bearing stablecoins, emphasizing its potential negative impact on stablecoin development.
Related: Crypto industry split over CLARITY Act