CLARITY Bill Paused : Crypto Industry Pushes Back

Under regulatory pressure, the American crypto sector closely watched the CLARITY Act, intended to establish a clear legal framework for these assets. However, the bill was abruptly paused in Congress after Coinbase’s dramatic withdrawal of support. Presented as a structural reform, the latest version of the project triggered sharp criticisms, accused of threatening innovation. A political setback that reignites tensions between legislators and actors of an ecosystem still seeking recognition.

The CLARITY Bill Paused : Controversial Legislation from Its Latest Version

The CLARITY bill, designed to regulate the crypto market in the United States, was abruptly halted after Coinbase, a major player in the ecosystem, withdrew its support.

On January 17th, Brian Armstrong, CEO of the platform, shared on X a direct critique of the bill, revealing several provisions deemed threatening to innovation. According to him, the current version of the law contains unacceptable points : “the text de facto bans tokenized stocks, imposes government access to DeFi user data, and bans yield stablecoins”.

Here are the main points of friction identified by Coinbase :

• The de facto ban on tokenized stocks : a barrier to integrating traditional markets and blockchain ;
• Government access to DeFi user data : concerns about privacy and decentralization ;
• The prohibition of yield stablecoins : a direct threat to a pillar of decentralized finance.

Analyst Michaël van de Poppe also reacted, emphasizing the harmful effects this version could have had on the entire market : “I think if the bill had been adopted in its current version, the impact would have been very negative on the markets”.

This opposition highlights a growing rift between American regulators and crypto players, who denounce a regulatory intent perceived as punitive, without sufficient consultation with industry professionals.

A Strategic Pause That Feels Like a Victory for the Crypto Ecosystem

Beyond immediate tensions, several industry figures see it as an opportunity to renegotiate a more suitable framework.

Still on X, Brian Armstrong sought to temper speculation that the White House had threatened to withdraw support for the bill after Coinbase’s reversal. He states that “negotiations are still ongoing to reach a version of the project that would suit both the crypto industry and community banks”. This statement aims to defuse tensions while reaffirming the desire to achieve balanced legislation.

This suspension could thus provide a valuable space for dialogue, similar to the process that led to MiCA regulation in Europe, which was amended several times before adoption. Van de Poppe himself draws this parallel: “it strongly reminds me of the MiCA regulations in Europe”.

The European precedent shows that regulatory frameworks can emerge from strong compromises, provided that debates are not rushed. Meanwhile, some DeFi actors fear that overly strict measures could permanently hinder innovation. Investor Nic Carter, also on X, warns : “Don’t let them kill stablecoin yields. That would stifle their development for a whole generation.”

Halted even before being debated, the CLARITY Act divides the American Senate and crypto actors. Between fears of overly rigid regulation and the need for regulatory clarity, a balance remains to be found. This blockage underscores the persistent difficulty of building a framework adapted to innovation without stifling it. The dialogue remains open, but tensions persist.