Crypto Crackdown: Grassley-Lummis Shake-Up Sparks Clarity Act Buzz

Key Highlights

• Mr. Grassley and Ms. Lummis have threshed out revisions to harden the anti-money-laundering provisions in the CLARITY Act, in a manner that would make a stern aunt nod in approval.
• The bill also affords a protective shawl to software developers while arming the lawmen with shinier gadgets for the crypto chase.
• The final text is due to drop today, with the fussy deadline of May 12 for amendments.

Judiciary Committee Chair Senator Chuck Grassley and Senator Cynthia Lummis have, according to the grapevine, struck a concord on revisions to the CLARITY Act.

The changes would give prosecutors broader authority to pursue crypto-related financial mischief, including bringing AML charges against those who dabble in digital assets for illicit purposes.

Citing two people familiar with the brouhaha, Punchbowl’s Brendan Pedersen whispered that the agreement had been sealed with a kiss (metaphorically, of course).

Senator Cynthia Lummis confirmed the deal and thanked Senator Grassley publicly. She said, “Thank you @ChuckGrassley for ensuring BRCA/sec 1960 protections for software developers are included in the Clarity Act while giving law enforcement tools they need. Clarity Act is the most pro-law enforcement digital asset bill Congress has ever considered. Let’s get this done!”

Final bill text expected today

The agreement arrives as lawmakers steel themselves for a key Senate Banking Committee session, the length of which will determine how the United States defines the layout for digital assets.

The final version of the CLARITY Act is expected to make its entrance today. Senators had until May 12 to fling amendments at it. The Banking Committee is expected to take a gander and vote soon after, a crucial step on the ladder toward moving forward.

Clash over stablecoins

Meanwhile, there is still a tiff brewing about stablecoins. The American Bankers Association is paddling furiously to tweak the wording, warning that current language could permit crypto firms to offer yield-like rewards on stablecoins.

ABA President Rob Nichols asserted, in a letter, that without changes, the plan could “unnecessarily incentivize the flight of bank deposits into payment stablecoins, risking economic growth and financial stability.”

Banks also argue that stablecoin rewards should be tighter because they resemble savings accounts-but without the same safety net-and they urge lawmakers to plug the gaps.

Crypto industry pushes back

On the other side, crypto enthusiasts are pushing back with gusto. The Digital Chamber’s Chief Policy Officer, Cody Carbone, dismissed the banking lobby as a late-in-the-game nuisance, suggesting banks had months to air their grievances but chose to bide their time until the final markup.

The CLARITY Act also makes a stab at clearly defining which U.S. agencies regulate crypto. It draws a neat line between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), a riddle that has vexed the bewildered for years.

At the heart of the dispute is a hefty question: should stablecoins be mere payment devices, or should they also offer rewards like interest? Proponents of rewards say users deserve a share of the returns on assets backing stablecoins, such as short-term U.S. Treasury holdings. Banks disagree and say it could loosen the traditional banking spine.

The Senate Banking Committee’s forthcoming perusal will decide how much of this stays in the final act.

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2026-05-11 22:12