A draft Senate Republican version of the CLARITY Act would compel certain centrally operated crypto trading platforms to register with the Commodity Futures Trading Commission, creating a new regulatory obligation before the bill’s initial procedural vote on September 15.
The 630‑page amendment was unveiled on Thursday by Senator Cynthia Lummis and her Republican colleagues. For the past year, the Senate has been working to pass the first federal framework regulating the cryptocurrency industry.
Lummis noted that Republicans incorporated more than 114 provisions advocated by Democratic negotiators. She argued the measure would give the crypto sector durable rules that survive changes in presidential administrations, unlike regulations that shift with White House control.
DeFi Adjustments Draw a Line Around Protocol Control
Under the revised language, a protocol would be classified as “non‑decentralized finance” if an individual or coordinated group holds authority—directly or indirectly via an agreement, relationship, or other arrangement—to manage its functions or enact material changes to its operations or consensus rules.
Entities falling into that category would be required to register with the CFTC. The bill also instructs the CFTC, in coordination with the Treasury Department, to develop implementing regulations. A crypto‑industry source said Democrats pushed for the inclusion of this provision.
A separate amendment restricts the DeFi‑related provisions to spot and cash transactions involving digital commodities. Lummis said the limitation addresses tribal governments’ worries about the bill’s effect on prediction markets.
Lummis added that the draft clarifies how credit unions may engage in cryptocurrency activities.
The revisions arrive as legislators confront a tightening schedule to move the broader bill forward after the recess. The legislation’s path to President Donald Trump’s desk has already been stalled by disputes between banks and the crypto industry over stablecoin rewards, illicit‑finance concerns, and an unresolved ethics issue.
Trump‑Linked Crypto Wealth Remains Central to Ethics Debate
The ethics dispute focuses on how the legislation should handle Trump’s growing cryptocurrency holdings, which include hundreds of millions of dollars tied to World Liberty Financial and the TRUMP memecoin.
In July, Trump endorsed an ethics measure that would bar government officials, public employees, and their spouses from sponsoring or issuing digital assets. Enforcement would fall to the Justice Department rather than state attorneys general, and the rule is set to expire at the start of January 2029.
Democrats contended those safeguards were insufficient and later introduced alternative ethics language alongside Republican Senator Thom Tillis.
The current draft largely retains the original ethics provision. Politico reported that the revised bill still lacks Democratic support, which is essential for its passage.
Lummis has repeatedly used X to urge passage as she nears the end of her Senate tenure. She is not running for re‑election and is scheduled to depart Congress in January 2027.
In a Wednesday post, Lummis said enacting the bill would enable the United States to set its own cryptocurrency rules instead of ceding leadership to jurisdictions such as Singapore or the United Arab Emirates. She also appealed to the nation’s tradition of leadership, arguing the U.S. should remain at the forefront.