US New CLARITY Act Proposes to Ban Presidents and Officials from Issuing or Sponsoring Cryptocurrencies
The new version of the CLARITY Act under review by the US Senate includes provisions that prohibit the President and other federal officials from issuing or sponsoring cryptocurrencies and other digital assets.
Republican lawmakers updated the bill text on Wednesday, clearly restricting officials from profiting through crypto assets, applicable to the President and federal officials.
Market participants in the crypto industry are now the main focus, with funds temporarily awaiting regulatory implementation. Compliant exchanges and regulated projects are expected to benefit, while individuals or projects that may involve conflicts of interest are under pressure, overall pushing the digital asset market towards a more transparent framework and reducing policy uncertainty.
Source: Public Information
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The US has been engaged in ongoing debates over crypto regulation for the past few years, intensifying scrutiny after the FTX collapse in 2022, leading to multiple bill proposals. The CLARITY Act continues the bipartisan consensus in Congress for market normalization.
In terms of capital flow, the bill promotes the concentration of resources towards compliant infrastructure and regulated entities, motivated by the aim to reduce systemic risks and prevent conflicts of interest among public officials, shifting funds from gray area projects to institution-level products protected by clear rules.
Drawing a parallel to the historical strict limitations on insider trading and conflicts of interest in securities law, the current bill indicates that the crypto market is transitioning from a phase of unregulated growth to one of comprehensive federal oversight.
Essentially, this represents a regulatory change: the legislation clarifies the behavioral boundaries for public officials, with mechanisms to prohibit sponsorship and profit clauses reducing moral hazards, forcing capital to shift from regulatory arbitrage to compliant innovation, thereby accelerating the institutional development of digital asset market infrastructure and long-term capital inflows.
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- The clearer the regulation, the more willing long-term capital is to enter on a large scale.
- Prohibiting conflicts of interest = necessary cost for market trust; public official rules reshape the industry ecosystem.
- The growth phase relies on gray areas, while the maturity phase relies on frameworks; winners position themselves for compliance early.