On July 17, 2025, the U.S. House of Representatives passed H.R. 3633, the Digital Asset Market Clarity Act (the “CLARITY Act”), by a decisive 294–134 vote. The legislation aims to bring long-awaited structure to the regulation of digital assets. It clearly defines the roles of the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
The CLARITY Act was part of an aggressive “Crypto Week” legislative session that also included:
- GENIUS Act (stablecoin regulation): Passed by the House 308–122, already approved by the Senate and signed by the President.
- Anti‑CBDC Surveillance State Act: Barred the Federal Reserve from issuing a retail CBDC, passed 219–210.
These acts represent the most substantive federal crypto regulation to date, signaling Washington’s pivot from enforcement-heavy tactics to legislative clarity
This action builds on a broader legislative effort. It is summarized in our earlier article, “Crypto Week: Congress Votes on Key Bills for Digital Assets”. It further solidifies Congress’s intent to give legal clarity for digital commodities. Congress also aims to clarify tokenized ecosystems.
What the CLARITY Act Does
The CLARITY Act introduces the first formal statutory framework for distinguishing between digital commodities and digital securities. Key provisions include:
- Clear definitions for “digital commodity” and “digital asset,” including decentralization thresholds for maturity;
- Exclusive CFTC jurisdiction over spot markets and intermediaries dealing in digital commodities;
- SEC jurisdiction over digital assets deemed securities, including anti-fraud enforcement across all markets;
- A provisional registration process allowing exchanges, brokers, and dealers to operate while formal registration rules are developed;
- Explicit treatment of stablecoins under a separate permitted category for joint oversight;
- Required compliance with AML/CFT rules under the Bank Secrecy Act.
You can read the full legislative text here.
Legislative Context and Support
The CLARITY Act’s passage is part of a broader push to legislate crypto regulation. This includes the GENIUS Act (a stablecoin framework). It also includes the Anti-CBDC Surveillance State Act. These bills collectively show Congress’s increasing urgency to clarify digital asset markets and curtail central bank digital currency development.
Industry stakeholders have welcomed the move. The Crypto Council for Innovation has characterized the bill as a major step toward legitimacy. Several institutional players also see it as contributing to market stability. For a breakdown of industry reactions, see coverage in MarketWatch.
What’s Next: Senate Review and Rulemaking
The House has secured passage. The CLARITY Act now moves to the Senate. It is expected to be debated before the August recess. Senate committees may propose amendments. The final version will need to reconcile with any counterpart legislation before reaching the President’s desk.
If enacted, the SEC and CFTC will start a rulemaking process to implement the Act. This process involves defining standards for decentralization. It includes setting registration and reporting requirements. Another key task is coordinating joint oversight mechanisms for stablecoins and overlapping products. The implementation phase is expected to span several years, with provisional registration serving as a transitional on-ramp for industry compliance.
Final Thoughts
The passage of the CLARITY Act in the House marks a significant moment in the evolution of U.S. crypto regulation. For years, market participants have operated under regulatory uncertainty and overlapping enforcement. This bill sets the stage for clearer jurisdiction. It introduces standardized compliance obligations. It also enhances investor protections that will define the next era of digital asset growth in the United States.
The Senate is getting ready to weigh in. Stakeholders should watch legislative updates. They should also prepare for regulatory alignment as the rulemaking phase begins.
Staying informed and compliant in this evolving landscape is more critical than ever. Whether you are an investor, entrepreneur, or business involved in cryptocurrency, our team is here. We provide the legal counsel needed to navigate these exciting developments. If you believe we can assist, schedule a consultation here.