Citi (C) says CLARITY Act momentum builds, but DeFi fight could stall crypto bill

Citi analysts view the passage of the CLARITY Act as the essential catalyst for legitimizing digital assets in the U.S. by defining regulatory frameworks for digital assets, classifying tokens, and clarifying jurisdiction between securities and commodities law. While the Senate Agriculture Committee has advanced its version, progress is slowed by contentious negotiations, particularly concerning decentralized finance (DeFi). The biggest hurdle involves defining when decentralized protocols become regulated service providers, as overly restrictive rules could hinder Web3 development, decentralized exchanges, and layer-2 networks. Citi suggests compromise on stablecoin rewards might be possible, though banks express concerns about regulatory arbitrage. Despite Coinbase ending support for the legislation, HSBC noted this won't derail the process, suggesting a sensible compromise might still be reached, though timelines remain uncertain with a risk of delay past 2026.

(Source：CoinDesk)