Crypto Industry Urges Senate to Advance Clarity Act as U.S. Risks Losing Innovation Overseas

A broad coalition of crypto firms and advocacy groups is pressing the U.S. Senate to move the Clarity Act forward, warning that Washington’s usual delay tactics could send jobs, capital, and real innovation overseas.

• Crypto industry wants Senate action on the Clarity Act
• Stablecoin rewards, SEC vs. CFTC oversight, and developer protections are still unresolved
• Delays could push innovation offshore as the U.K. and Hong Kong move faster
• Coinbase, Circle, Kraken, Ripple, Uniswap Labs, and others backed the push

On April 23, the Crypto Council for Innovation and the Blockchain Association led a letter to Senate leaders urging them to “notice and proceed towards a markup” of the Clarity Act. In plain English, that means the industry wants lawmakers to stop kicking the can and actually start shaping a federal crypto rulebook.

The letter was sent to Sen. Tim Scott, Sen. Elizabeth Warren, Sen. Cynthia Lummis, and Sen. Ruben Gallego — the key players in the Senate Banking Committee and its digital assets subcommittee. The message was simple: if Congress wants the U.S. to lead in crypto, it needs to stop treating regulation like an endless hostage negotiation.

The Clarity Act is meant to do something the U.S. has badly lacked for years: define which digital assets and activities fall under SEC oversight and which belong to the CFTC. That distinction matters because the SEC generally handles securities, while the CFTC oversees commodities and derivatives. Crypto has spent years stuck in the middle, with projects often unsure which agency’s rules they’re supposed to follow — or whether they’ll be hit with enforcement after the fact.

That uncertainty is exactly why industry groups are pushing for a consistent federal baseline across all 50 states. Without one, companies are forced to navigate a patchwork of rules, state by state, where one jurisdiction says “come on in,” another says “maybe later,” and a third acts like it invented regulation in a fever dream. For startups, exchanges, wallets, and protocol teams, that’s not clarity. That’s a bureaucratic mess.

The coalition argues the costs are already obvious. If the U.S. keeps dragging its feet, it risks pushing investment, jobs, and technological development offshore. That isn’t a dramatic crypto talking point; it’s how regulatory arbitrage works. In plain English, if one country gives builders a clearer path than another, capital and talent tend to move where the rules are easier to understand and less likely to change after lunch.

And that pressure is real. The U.K. and Hong Kong have both been moving faster on crypto rules, including clearer frameworks for licensing and digital asset activity. If Washington keeps moving like a bureaucratic committee with a hangover, it should not be shocked when builders start choosing jurisdictions that actually seem interested in hosting the next generation of financial infrastructure.

One of the biggest flashpoints is stablecoin rewards. Banks have been pushing back hard, apparently worried that consumers might prefer something more efficient than the old deposit-and-fee treadmill. At a Washington event, Sen. Bernie Moreno reportedly dismissed that bank opposition as “a lot of noise in the system,” according to journalist Eleanor Terrett. He also said he expects market structure legislation to be completed by the end of May.

That timeline may be ambitious, but it does highlight the broader fight: stablecoins are no longer a niche crypto toy. They are increasingly tied to payments, savings, trading, and on-chain commerce. Banks do have legitimate concerns about risk, disclosures, and competition, but let’s not pretend every complaint is a noble consumer-protection crusade. Sometimes it’s just incumbents trying to protect their fee stream.

Another major problem is the ongoing fight over who gets to police what: the SEC or the CFTC. Crypto firms have spent years trapped in the middle of this turf war, where the rules are vague, the interpretations are inconsistent, and the penalties can arrive before the guidance does. That has fed the hated era of regulation by enforcement — a system where the government seems to prefer lawsuits and headlines over actual rulemaking.

The coalition warned that the United States cannot risk “a return to the previous era of regulation by enforcement” and said “timely action is critical.” Fair enough. If companies are supposed to comply, they need to know what they’re complying with. “Guess first, maybe get sued later” is not exactly a world-class policy framework.

The other issue that deserves more attention is protections for decentralized developers. That sounds technical, but it’s one of the most important parts of the fight. Decentralized developers are the people building open-source protocols and blockchain software, often without controlling the networks they create. If lawmakers fail to distinguish between those builders and centralized intermediaries, they could accidentally criminalize or suffocate legitimate software development in the U.S.

That would be a serious self-own. Open-source builders are not traditional financial middlemen, and treating them like banks or broker-dealers by default would make the U.S. a worse place to build decentralized systems. If Congress wants innovation, it needs to stop pretending every line of code is a Wall Street firm in disguise.

The broader push is not limited to the Clarity Act. A separate coalition of 30 crypto advocacy groups recently urged the SEC to clarify its stance on staking, calling it a “technical process”. Staking means locking up crypto to help secure a blockchain network and, in return, earning rewards. For many networks, it is a core part of how the system operates. It is not automatically a securities scheme just because regulators feel allergic to nuance.

The list of signatories backing the Senate push is a heavyweight one: Coinbase, Circle, Kraken, Uniswap Labs, Ripple, Andreessen Horowitz, Chainlink Labs, Chainalysis, OKX, Paradigm, and Block. That is not some tiny cluster of speculators yelling into the void. It is a broad slice of the crypto and fintech industry saying the same thing: give us clear rules, or watch the next wave of development happen somewhere else.

The coalition framed the issue as a chance for Congress to build a durable framework for the next phase of financial technology.

“With thoughtful market structure legislation, Congress has the opportunity to extend that leadership into the next generation of financial technology.”

That’s the kind of line lawmakers love to quote in speeches. The harder part is proving they mean it. If the U.S. wants to lead on crypto, it can’t keep relying on enforcement theater, vague signals, and committee gridlock while other regions move ahead with actual rulebooks.

There’s also a political reality here that neither side can fully ignore. Crypto firms want a predictable framework so they can launch products, hire teams, and raise capital without legal whiplash. Regulators, meanwhile, are under pressure to prevent fraud, protect consumers, and avoid handing the market to bad actors. Those are not fake concerns. The problem is that years of indecision have produced the worst of both worlds: uncertainty for builders and confusion for everyone else.

• What is the Clarity Act?
  It is a proposed crypto market structure bill designed to define which digital assets and activities are overseen by the SEC and which fall under the CFTC. The goal is a clearer federal rulebook.
• Why are crypto groups pressing the Senate now?
  They say delays are hurting U.S. competitiveness and could push investment, jobs, and development offshore. In their view, fast-moving jurisdictions like the U.K. and Hong Kong are gaining ground while Washington hesitates.
• Why does SEC vs. CFTC oversight matter?
  Crypto projects need to know which regulator they answer to. Without that clarity, companies face legal uncertainty, higher compliance costs, and the constant risk of enforcement actions.
• What are stablecoin rewards, and why are they controversial?
  Stablecoin rewards are incentives offered for holding or using stablecoins. Banks worry they could compete with deposits and payment products, while crypto firms argue they are part of a more efficient digital financial system.
• What does regulation by enforcement mean?
  It means regulators shape policy through lawsuits and crackdowns instead of clear rules. That approach creates uncertainty and makes it hard for legitimate companies to know how to comply.
• Why do decentralized developers need protection?
  Because open-source builders are not always in control of the networks they create. If the law treats them like centralized financial intermediaries, it could chill legitimate crypto and blockchain development in the U.S.
• How does staking fit into the bigger fight?
  Staking is another example of the industry asking regulators for straightforward guidance. Crypto groups want it treated as a technical network function, not automatically as a securities issue.
• Who is backing the push for the Clarity Act?
  Major names including Coinbase, Circle, Kraken, Ripple, Uniswap Labs, Block, Paradigm, and others are supporting the effort. That gives the push serious industry weight.

The real question is whether Congress wants to lead or just posture. A sensible crypto framework would not solve every dispute overnight, and it would not erase the need for enforcement against fraud. But it would stop the endless guessing game that has driven so much innovation out of the United States and into friendlier jurisdictions.

If lawmakers want the U.S. to stay relevant in crypto, they need to do more than talk about leadership. They need to write rules that actually let people build.