Trump Crypto Adviser Rejects CLARITY Act Plan

Law Enforcement Groups Push for CLARITY Act Changes, White House Remains Skeptical

Law enforcement organizations, with backing from prominent Democrats, have put forward proposed amendments to the CLARITY Act that could simplify the prosecution of certain cryptocurrency software developers. However, White House officials have indicated that these suggestions do not meet their expectations.

Patrick Witt, a cryptocurrency advisor to former President Trump, criticized the proposal, asserting that claims of “productive negotiations” with the White House and Treasury were inaccurate. He stated that the administration had clearly communicated its stance to Senator Catherine Cortez Masto for weeks, and the latest revision was “not even close” to satisfying their requirements.

According to a report by Politico, two major organizations representing U.S. prosecutors have submitted revised language to the White House in an effort to break a months-long impasse over the CLARITY Act.

Senator Masto, in a statement, described the new language as the “culmination of productive negotiations with law enforcement, the White House, and Treasury,” expressing optimism about resolving the issue.

The proposed changes primarily target the Blockchain Regulatory Certainty Act (BRCA), with the revised text removing provisions that could offer developers some protection from criminal prosecution. The core of the disagreement centers on whether law enforcement should hold crypto developers accountable for illicit activities occurring on the platforms they create.

The Trump administration has previously argued for protecting builders who do not handle customer funds, aiming to foster innovation. Conversely, critics and law enforcement groups have warned that the current wording could inadvertently facilitate unchecked financial crimes.

New York Attorney General Letitia James has echoed these concerns, recently stating that the CLARITY Act could undermine state efforts to combat crypto fraud by limiting the state’s ability to hold digital asset firms accountable.

However, not all parties oppose the latest amendments. The Fraternal Order of Police, the largest police organization in the U.S., has withdrawn its previous objections and now supports the cryptocurrency bill, having previously raised concerns about the BRCA.

The Politico report also indicates that several other groups have lent their support to the legislation, including the National Organization of Black Law Enforcement Executives and the Federal Law Enforcement Officers Association.

Last month, over 160 former national security, intelligence, and other officials penned a letter to the Senate in favor of the bill, arguing that it would bolster efforts to combat illicit finance within the cryptocurrency sector.