CLARITY Act faces state attorneys general opposition before Senate vote

The CLARITY Act is set for a key procedural vote in the US Senate on Tuesday, but it is now facing new resistance from a bipartisan coalition of 18 state attorneys general. Led by New York Attorney General Letitia James, the group warned Senate Banking Committee leaders that the bill could limit states’ ability to pursue crypto companies accused of fraud or other wrongdoing. They argued that parts of the draft are unclear and could weaken state police powers. The pushback comes even as lawmakers make progress on a separate ethics compromise tied to President Donald Trump’s crypto interests. The revised proposal would require certain officials with significant crypto holdings to divest or place those assets in blind trusts, and it would also give state attorneys general a role in enforcing the rules. The CLARITY Act would create a federal framework for digital assets and define how oversight would be split between the Securities and Exchange Commission and the Commodity Futures Trading Commission. Tuesday’s vote will determine whether the bill moves forward to debate in the Senate.