Senator Elizabeth Warren's staff is opposing the latest ethics compromise in the revised crypto bill, arguing that new enforcement powers for state attorneys general are ineffective. This pushback occurs despite significant concessions from Senate Republicans.
Staff for Senator Elizabeth Warren, the top Democrat on the Senate Banking Committee, are circulating arguments against the latest ethics compromise included in the revised crypto bill.
The pushback comes despite Senate Republicans making major concessions,
According to Punchbowl News reporter Brendan Pedersen, Warren's Banking Committee staff argues that the new enforcement powers granted to state attorneys general are largely illusory.
New state-level enforcement mechanism falls short of providing a genuinely independent means of enforcing the restrictions, according to the staff.
Among other things, they argue that restrictions on issuing or sponsoring digital assets would generally apply to assets launched after the provisions take effect.
The ethics dispute is far from the only problem confronting the Clarity Act.
A bipartisan coalition of 18 state attorneys general, led by New York Attorney General Letitia James, is urging lawmakers not to pass the legislation.
The group argues that the bill could weaken states' ability to pursue cryptocurrency fraud. Their intervention comes only a day before the procedural vote.
Banks are also dissatisfied with the revised legislation. Eight banking trade groups have criticized the newly added "circuit breaker" designed to address fears that stablecoin rewards could drain deposits from community banks.
Parts of the cryptocurrency industry are unhappy as well. The latest text narrowed protections contained in the Blockchain Regulatory Certainty Act, or BRCA. The change has drawn criticism from some crypto policy advocates.
Senator Susan Collins of Maine, a Republican, has indicated that she has not yet decided whether to support the Clarity Act. Collins described the legislation as a "moving target."
"It's more than 600 pages, with a new ethics provision in it, and other provisions that I need to look at, such as whether it would cause community banks to lose deposits," she said, according to Pedersen.
The Clarity Act is heading into what could be its most perilous moment yet.
Warren's staff argues that the new enforcement powers for state attorneys general are largely illusory and do not provide a genuinely independent means of enforcing restrictions.
Senate Republicans have made major concessions in the latest version of the crypto bill, although specific details of these concessions are not outlined.
The revised crypto bill introduces new state-level enforcement mechanisms, but Warren's staff claims they fall short of being effective.
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