But if we look past the name, Clarity isn’t really a bill about enabling crypto, the technology. It is a bill about enabling crypto middlemen.
Crypto was supposed to remove middlemen
Crypto’s origin story begins with the Bitcoin whitepaper, published amid the 2008 financial crisis. “Trusted third parties,” i.e., middlemen or intermediaries, may have once been necessary, but they are also points of failure. The combination of cryptography with the ubiquity of the internet could safely replace those points of failure with peer-to-peer transactions.
That was the point. Securely enabling a peer-to-peer financial system through technology.
Yet, reading the text of the ClarityAct, you’d be forgiven if you thought being pro-crypto meant being pro-middlemen. The legislation is built around exchanges, brokers, custodians and other intermediaries.
In my review, only 2–4% of the bill’s language focuses on the underlying technology, while 44–77% focuses on intermediaries. (The figures vary across the House-passed bill, the Senate Agriculture Committee draft, and the Senate Banking Committee draft.)
It’s as if Congress were to propose its first “medicine” bill. But rather than establishing any requirements for proof of effectiveness, testing and safety, or labeling, Congress spent most of its ink on how the Walmarts and CVSs could sell to us.
