Key Takeaways
- Van Valkenburgh warned that without legislative clarification, a future administration’s Department of Justice could increase prosecutions of privacy tool developers
- The point of passing CLARITY is not to trust this administration. It is to bind the next one, he wrote
Peter Van Valkenburgh, executive director of advocacy group Coin Center, warned on Friday that failing to pass the CLARITY Act could leave the crypto industry vulnerable to a future administration less sympathetic to digital assets.
In a post shared on X, Van Valkenburgh argued that prioritising short-term business interests and the goodwill of those currently in power over statutory developer protections in legislation like the CLARITY Act and the Blockchain Regulatory Certainty Act could lead to a grim outcome for the industry.
“The point of passing CLARITY is not to trust this administration. It is to bind the next one,” he wrote. “A world without CLARITY’s statutory protections for developers is a world governed by prosecutorial discretion, political fashion, and fear. And the winds that will blow are easy to see.”
Van Valkenburgh warned that without legislative clarification, a future administration’s Department of Justice (DOJ) could increase prosecutions of privacy tool developers as unlicensed money transmitters, and that existing regulatory guidance could be revoked.
CFTCHis comments come as the CLARITY Act has stalled in the Senate after banks, crypto firms and lawmakers failed to reach agreement on key provisions, including whether to allow stablecoin yields. The bill covers frameworks for registering crypto intermediaries, establishes clear jurisdiction for the US Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), mandates registration for digital commodity exchanges among others.
During the previous US administration, former SEC Chair Gary Gensler drew heavy criticism from crypto firms for allegedly shaping policy through enforcement actions and legal settlements rather than formal rulemaking, an approach Van Valkenburgh’s comments suggest could return without binding legislation in place.
Earlier this week, the District Court of the Northern District of Texas granted the US government’s motion to dismiss the lawsuit from Michael Lewellen —who developed Pharos — seeking preemptive legal protection from money transmitter laws.
