The law was built for companies. The future may be built by networks

Why Congress is finally creating rules for blockchain networks instead of forcing them into corporate frameworks.

The Senate Banking Committee just voted on a bipartisan basis to advance crypto “market structure” legislation — a historic milestone that moves the crypto industry forward. How? Because the Digital Asset Market CLARITY Act (CLARITY) would finally create clear rules of the road for blockchain networks and digital assets.

Without clear regulation, the U.S. regulatory approach over the last decade has distorted markets, stifled innovation, and left consumers exposed to significant harms. CLARITY would end this failure. Like the Securities Act of 1933 — which established investor protections and powered a century of U.S. capital formation and innovation — CLARITY creates a once-in-a-generation shift in the U.S. financial regulatory landscape; the kind of shift that creates enormous opportunity.

Since just passing Senate “markup” today, the foundational legislation critical for the entire crypto industry — from startup founders and consumers to large traditional financial institutions moving onchain and investors — is now closer than ever to becoming law. Next, the two bills from the respective Congressional committees will be combined into a single comprehensive bill that will be voted on by the entire Senate. If this bill passes that vote, it will then be sent to the House for approval and, if successful there, to the White House for the President's signature.

Why the U.S. needs CLARITY now

Despite the growth and prevalence of the crypto industry and its activity over the last decade, the United States lacks a comprehensive regulatory framework. Instead, U.S. regulatory agencies have had to rely on a patchwork of existing regulations to oversee the industry, but that approach has been an abject failure. Not only has it resulted in confusing and constantly shifting interpretations of the law, but it’s also led to significant government overreach and abuse.

This regulatory uncertainty has not only hindered innovation but has also created a feeding ground for bad actors. As we’ve seen in the high-profile media coverage of crypto over the last decade, ill-intentioned individuals were able to easily launch products that exploited regulatory gaps, taking advantage of consumers. Meanwhile, responsible builders were subject to dubious “regulation-by-enforcement”.

This uncertainty has driven crypto development offshore. When the U.S. fails to foster innovation, entrepreneurs seek out other jurisdictions, including those that offer calibrated regulatory regimes. The European Union’s Markets in Crypto-Assets (MiCA) regulation and the United Kingdom’s crypto regulations are just two examples where the U.S. is behind. Fortunately for U.S. innovation, no other jurisdiction has gotten the regulatory scheme right yet. But well-tailored regulatory regimes will eventually attract and concentrate startup activity in those regions, along with the economic value and jobs they create. Imagine what the U.S. economy would look like if Amazon, Apple, Facebook, Google, Microsoft, Netflix, NVIDIA, and Salesforce were all started outside the United States.

So if the U.S. provides builders with regulatory clarity, it will be a boon for domestic innovation. A prime example of this is the U.S. passing the GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act) in July 2025. GENIUS created a regulatory framework for stablecoins — digital assets pegged to fiat currencies, often dollars — that enables a novel paradigm: open money infrastructure. Its passage led to unprecedented growth and adoption, which is not only good for the U.S. economy but is also good for the long-term dominance of the U.S. dollar.

When our legal frameworks are designed to both foster innovation and protect consumers, America leads and the world benefits.

The entrepreneurs and adopters who believe in the promise of crypto, despite what others may perceive, deserve a clear regulatory framework to pursue their visions. They deserve a framework that recognizes the potential of blockchain networks to drive an important and novel technological platform shift, one that goes beyond the speculative use cases that bad policy has enabled and that allows building beyond the initial financial applications (which are already covered under current U.S. regulations).

CLARITY is purpose-built to create that clear regulatory framework.

How we got here

The substance of the CLARITY Act is not entirely new. Many of the concepts and principles it draws on are derived from existing commodities laws and securities laws. The bill also evolved from prior iterations of legislation, including two “market structure” bills that originated in the House of Representatives: the Financial Innovation and Technology for the 21st Century Act or “FIT21” (HR 4763) of 2024; and the Digital Asset Market Clarity Act or “CLARITY Act” of 2025 (HR 3633).

Much like the current Senate bill, both FIT21 and the House version of CLARITY aimed to give blockchain networks a pathway to:

• safely and effectively launch blockchain networks and digital assets in the United States;

• clarify the line between the SEC and CFTC on who regulates what in crypto, and whether digital assets are a security or a commodity;

• ensure oversight of crypto exchanges; and

• further protect American consumers by implementing rules on crypto trading.

FIT21 was passed two years ago with overwhelming bipartisan support (279-136; 71 Democrats supporting). The House version of CLARITY was passed in July 2025 with even greater bipartisan support (294 to 134; 78 Democrats supporting). Collectively, these bills sent a strong signal to the Senate to accelerate its work on crypto market structure legislation.

The Senate’s version of CLARITY builds on the bipartisan momentum in the House and improves upon prior bills in several key ways (more below). It’s been making its way through the Senate for years, with the most significant activity occurring over the last year as follows:

• In June 2022, Senators Lummis and Gillibrand first introduced the Lummis-Gillibrand Responsible Financial Innovation Act, which was the first bipartisan legislative proposal to create a comprehensive regulatory framework for crypto.

• In July 2025, the Senate Banking Committee (which oversees the SEC) released a discussion draft of the portion of the bill under its jurisdiction that merged and harmonized the two approaches set forth in the Lummis-Gillibrand bill and the House version of CLARITY. In addition, the Committee issued a Request for Information (RFI), seeking feedback and legislative solutions designed to balance innovation with the need to preserve financial stability and protect consumers.

• In September 2025, based on feedback received, the Senate Banking Committee released a second discussion draft.

• In January 2026, the Senate Banking Committee released yet another iteration reflecting months of bipartisan negotiations.

• Also in January 2026, the Senate Agriculture Committee released and advanced through its committee its own draft of market structure legislation for the areas of the legislation that fall within its jurisdiction.

• And today (May 14, 2026), the Senate Banking Committee just advanced its portion of CLARITY in its “markup” committee meeting.

Why CLARITY matters: networks vs companies

Company building has driven innovation in the United States for over a century. That path is well established: Entrepreneurs raise capital to pursue business ventures, and, when successful, generate profits that benefit their shareholders. U.S. law is finely tuned to support this model; it imposes duties and fosters transparency to align incentives and manage the trust placed in founders and operators.

That framework works for building companies. But it works against building networks.

Existing legal frameworks assume control by a manager and require that control persist over time. But with networks, there is no controlling party. Networks coordinate people, capital, and resources — through shared rules, rather than through centralized ownership.

However, when existing frameworks built for companies are applied to networks, those networks are contorted into corporate form. Control concentrates. Intermediaries emerge. And value is extracted from those who depend on the system.

Across the digital economy, this dynamic has produced powerful corporate networks with tremendous concentrated power — payment systems, marketplaces, social platforms, and app stores — that capture a disproportionate share of the value created by the corporate network’s participants. A ride-share user may pay $100 for a ride, but only a fraction goes to the driver. A musician may make music streamed by millions of people, but only get paid pennies for every dollar their music earns.

Wherever corporate networks dominate, the majority of value accrues to intermediaries. Traditional corporate law protects those intermediaries and their investors — but it leaves users, creators, and workers exposed. For most of the internet era, this tradeoff was unavoidable. Open protocols lacked sustainable economic models and could not compete with the capital and coordination behind corporate networks.

Blockchains change that.

Blockchains and the software protocols deployed to them enable a new kind of system: blockchain networks. These networks are designed to distribute control, operate through transparent rules, and function as shared infrastructure owned and operated by users. Blockchain network value increases through public use, and can be distributed to participants, including those at the edges of the network, rather than only captured at the center.

Blockchains make it possible to build networks that actually function like networks, rather than corporations.

Blockchain technology is arriving at a critical moment. Prior platform shifts, such as personal computing, mobile phones, and the internet, were among the most important technological innovations in human history. The advent of AI is rapidly becoming one as well.

Yet all of these technological platform shifts have resulted in power and control being highly centralized, with a small few controlling the fates of the countless consumers, creators, and developers that depend on these technologies and services. As an increasing amount of the economy becomes digital and shaped by AI, the question of who controls the digital systems we depend on becomes more critical than ever. If that control remains centralized, so does the ability to shape outcomes, restrict access, and capture value: Companies will dictate how networks behave and who benefits.

Decentralized blockchain networks offer a different path: infrastructure that cannot be easily rewritten, censored, or redirected by any single actor. This means networks that can help decentralize existing platforms — replacing them with networks that function as digital public goods, reduce lock-in, diffuse control, embed neutrality, reduce single-point-of-failure risks, and place ownership in users' hands.

The CLARITY Act is designed to make this path viable.

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We’ll share more on what CLARITY does and doesn’t do for crypto builders once it gets to the floor and updates are made. But if CLARITY passes the next and final steps in the legislative process, the U.S. legal architecture will finally match what blockchain networks actually are. Builders will be able to operate transparently, raise capital domestically, and build for the long term — without having to make structural compromises that regulatory ambiguity forced on them.

And as more projects operate within the U.S. regulatory perimeter rather than outside it, regulators and law enforcement will have better tools to go after the fraud and abuse that have plagued the industry. We’ve seen what happens when crypto gets workable regulation: The GENIUS Act unlocked a wave of innovation overnight. We’re now seeing crypto inside several mainstream applications, from stablecoins to AI agents and more; the rest is yet to come.

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