The US Senate will consider a landmark cryptocurrency bill in mid-January — What does this mean for the industry?

On January 15, 2025, an important session will take place in the U.S. Senate to review the CLARITY Act — a regulatory framework expected to shape the future of cryptocurrency and how it is regulated in the U.S. According to Crypto in America, this review is anticipated to be a milestone in years of awaiting clear regulations.

Why is this session important?

The crypto industry has long faced legal uncertainty. What is cryptocurrency from a legal perspective? Is it a security or a commodity? Questions like these remain unanswered officially, forcing exchanges, developers, and investors to operate in an ambiguous legal environment.

The CLARITY Act is designed to end this situation. This legislative effort stems from a bipartisan collaboration among lawmakers, further driven by David Sacks — the head of AI and cryptocurrency at the White House. He has confirmed that this review will be prioritized early in the new year.

What will the CLARITY Act do?

The core goal of the bill is to establish a dual-regulatory structure:

U.S. Securities and Exchange Commission (SEC) will have authority over digital assets classified as securities — typically tokens from initial coin offerings or highly centralized projects.

U.S. Commodity Futures Trading Commission (CFTC) will oversee decentralized assets with commodity-like characteristics, including Bitcoin, Ethereum, and truly independent utility tokens.

This clear division will eliminate overlapping enforcement and provide necessary legal guidance. Additionally, the bill includes an exemption clause — networks that meet certain decentralization standards will be exempt from complex securities registration requirements.

What is the path to this review?

The legislative journey has been lengthy. Republican senators initiated efforts to craft comprehensive crypto legislation in the previous congressional session, but debates over regulatory scope and consumer protection caused delays. The current effort has been shaped by multiple draft bills, expert hearings, and industry feedback.

This normalization also reflects global competitive pressure. The European Union has implemented the Markets in Crypto-Assets (MiCA) framework, the UK has its own proposals, and other financial centers have curtailed much innovation. If the U.S. fails to establish clear regulations, capital and talent may flow to regions with clearer rules.

What will be the practical impact?

If the CLARITY Act passes, the crypto ecosystem will experience significant changes:

For exchanges: Regulatory clarity will reduce legal risks and compliance costs. Many current platforms operate in legal gray areas; the new framework will allow them to legitimize their operations.

For traditional institutions: Banks and investment funds have been waiting for clear regulations before fully participating. Once enacted, large-scale institutional capital could enter the market, increasing liquidity and stability.

For blockchain developers: Clear exemption criteria will set a standard for decentralization. This will promote the development of truly independent protocols while preventing centralized projects from evading regulations.

What are the key points to be discussed?

The review is expected to focus on:

• Defining “decentralization”: The bill needs to precisely define what qualifies a network as sufficiently decentralized to be exempt. This is a delicate legal boundary.

• Investor protection: Ensuring the framework safeguards retail investors from fraud and market manipulation.

• Inter-agency coordination: Establishing clear procedures for SEC and CFTC to cooperate across jurisdictional boundaries.

Observers note that bipartisan support will be crucial. While championed by Republicans, Democrats are also interested in promoting responsible innovation. The White House’s involvement indicates the administration is closely monitoring the process and seeking a balanced approach.

What’s next?

The session on January 15 is a procedural step in the legislative process. After the hearing, the bill may be amended, sent to committees for further work, or scheduled for a full vote. To become law, it must pass both the Senate and the House, then be signed by the President.

The outcome will have far-reaching implications: it will shape how cryptocurrencies are developed, used, and regulated in the U.S. in the coming years, and will also influence global regulatory standards.