Solana Institute warns Senate against weakening CLARITY Act

The Solana Institute has urged U.S. senators to preserve key provisions of the CLARITY Act as industry participants increasingly look toward an August timeline for advancing the legislation through Congress.

According to Solana Institute President Kristin Smith, the Blockchain Regulatory Certainty Act provisions included in the CLARITY Act should remain unchanged as lawmakers prepare to consider the bill in the Senate.

In comments posted on X, Smith said the CLARITY Act could soon reach the Senate floor, while arguing that protections for non-custodial blockchain participants are essential to the legislation.

Smith said the BRCA would establish that blockchain developers, node operators, and validators who do not take custody of customer funds should not be treated as money transmitters under U.S. law.

She argued that the language creates a clear distinction between software and infrastructure providers and firms that directly control user assets.

Describing the measure as consistent with guidance issued by the Treasury Department’s Financial Crimes Enforcement Network last year, Smith said the provision provides legal certainty for open-source software developers and network operators.

She added that major founders, executives, and investors from across the crypto sector had jointly asked Senate leaders not to dilute those protections.

Lawmakers continue debating key provisions

While industry groups push to keep the language intact, several outstanding issues remain under discussion in Washington. Smith noted that BRCA provisions were recently reviewed during a White House meeting involving law enforcement officials, where participants discussed possible changes. Ongoing negotiations over ethics-related language have also remained unresolved.

Those debates come as lawmakers, regulators, investors, and industry representatives prepare to meet in Chicago for discussions focused on digital asset regulation and market structure legislation.

Among the participants expected to contribute to those conversations is Representative Dusty Johnson, who helped advance an earlier version of the legislation through the House Agriculture Committee in a bipartisan 47-6 vote last year.

Crypto journalist Eleanor Terrett said she is particularly interested in hearing how members of the House Agriculture Committee view the Senate’s version of the CLARITY Act.

As chairman of the House Agriculture Committee’s Subcommittee on Commodity Markets, Digital Assets and Rural Development, Johnson is expected to offer insight into how House lawmakers may respond to revisions currently being considered in the Senate.

August timeline gains support

Recent reporting has suggested that congressional timing may be becoming a larger obstacle than policy disagreements.

As crypto.news previously reported, lawmakers, industry organizations, and market observers have increasingly shifted their expectations away from a July 4 signing target and toward the August congressional recess.

According to reporting from Crypto In America cited by Terrett, the Senate must still combine separate versions approved by the Banking and Agriculture Committees, secure 60 votes to advance debate, navigate additional cloture votes on amendments, and pass the final legislation before any revised measure can return to the House.

Terrett wrote on Monday that even if remaining policy disputes were resolved immediately, the legislative calendar leaves little room for a July 4 signing.

The CLARITY Act would establish jurisdictional boundaries for digital assets, placing decentralized cryptocurrencies such as Bitcoin and Ethereum under the oversight of the Commodity Futures Trading Commission while leaving qualifying securities under securities regulators.

The bill also contains provisions covering stablecoins, anti-money laundering requirements, decentralized finance activities, and blockchain validators.

Pointing to competitiveness concerns, Smith said the U.S. share of open-source crypto developers has fallen from 38% in 2015 to about 19% today.

She argued that maintaining regulatory certainty could influence where future blockchain development takes place, warning that jurisdictions such as Singapore and Abu Dhabi are competing to attract the industry’s next generation of builders.