US Treasury Secretary says Congress must pass the CLARITY Act for GENIUS to succeed
- Treasury Secretary Scott Bessent urges the US Congress to pass the CLARITY bill, calling it a "necessary next step."
- Bessent argues that the promise of the GENIUS Act cannot be fully realized without the CLARITY Act.
- The US Department of the Treasury proposed a rule requiring stablecoin issuers to maintain AML and CFT regulations.
US Treasury Secretary Scott Bessent has urged Congress to pass the CLARITY bill, warning that the long-term success of the GENIUS Act depends on establishing broader regulatory certainty for the digital asset market.
In an opinion piece published by The Wall Street Journal (WSJ) on Thursday, Bessent noted that while stablecoins have gained an initial regulatory foothold under the GENIUS Act, the next phase of innovation requires the development of clear, durable rules in the United States. He emphasized that "the promise of GENIUS can't be realized without CLARITY's support," highlighting the need for a comprehensive legislative framework.
Scott Bessent says regulatory gaps continue to weigh on innovation
The Treasury Secretary noted that regulatory ambiguity continues to define much of the digital asset sector outside of stablecoins. He pointed to past overlaps between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). These overlaps left market participants without clear guidance and contributed to the migration of crypto innovation to jurisdictions such as Abu Dhabi and Singapore.
The CLARITY Act aims to address these gaps by defining regulatory jurisdiction, establishing registration pathways for trading platforms and intermediaries, and clarifying when a digital asset qualifies as a security. The legislation would also introduce investor protection measures through disclosure and custody requirements, while strengthening safeguards against illicit finance.
"Congress acted decisively with GENIUS, and the CLARITY Act is the necessary next step," Bessent stated, adding that Congress "needs only to finish the job."
SEC Chair Paul Atkins echoed a similar opinion, stating in an X post that "it's time for Congress to future-proof against rogue regulators & advance comprehensive market structure legislation to President Trump's desk.
The comments come as the US Department of the Treasury aims to advance implementation of the GENIUS Act through a newly proposed rule targeting permitted payment stablecoin issuers (PPSIs).
The proposal requires issuers to establish comprehensive anti-money laundering (AML) and counter-terrorism financing (CFT) programs, including risk identification, assessment and mitigation frameworks.
It also aligns with the GENIUS Act's January 2027 compliance deadline and includes a 60-day public comment period.
Author
Michael Ebiekutan
FXStreet
With a deep passion for web3 technology, he's collaborated with industry-leading brands like Mara, ITAK, and FXStreet in delivering groundbreaking reports on web3's transformative potential across diverse sectors. In addition to
