Bitcoin
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- DeFi stakeholders have questioned the benefits of the CLARITY Act
- The stakeholders think the bill will push crypto and blockchain developers outside the U.S.
- They also think the bill is flawed and favors a select few
A month after receiving a nod from the House Agriculture Committee, DeFi stakeholders have voiced their concerns on the CLARITY Act, saying it’s flawed. Drawn from crypto-focused firms, including advocacy and nonprofits, they observed that the bill, if passed, will make the U.S a less-favorable destination for DeFi developers. They noted that the bill contains “impossible” rules for developers to follow and still honor DeFi principles like decentralization, something that’s likely to impact the quality of U.S.-based DeFi projects.
Bitcoin CLARITY Act Introduces Centralization
Speaking to Decrypt on condition of anonymity, the DeFi policymakers said the CLARITY Act forces DeFi platforms to be centralized and dictates the number of tokens that can be traded on each platform.
The stakeholders noted that they’ve avoided joining forces with those promoting the bill because it only caters to the “wants of only a select few in crypto.” The bill aims to define a framework for trading and creating virtual assets in the country.
According to one stakeholder, “the big players” are pushing lawmakers to pass the bill because it favors “one company’s stock price at the expense of leaving developers in the lurch.” They added that the bill is “written by and for the big companies in crypto.”
Bitcoin High Compliance Costs Block New Players
The policymakers also raised other concerns, such as the CLARITY Act’s ability to raise compliance costs and make it difficult for DeFi startups to enter the market. They also noted that the bill won’t disrupt established DeFi and crypto projects like Coinbase.
They’ve also raised concerns about the lack of clarification on the boundary between federal and state DeFi regulation. Other unsettled areas within the bill include self-custody of digital assets for DeFi users.
With DeFi stakeholders skeptical about the benefits of the CLARITY Act, it remains to be seen whether their voice will be enough to influence the lawmakers’ decision.
