President Donald Trump has agreed to provisions in the pending Clarity Act legislation – set to be voted on by the US Senate on September 15 – granting state Attorney Generals a “meaningful role” in enforcing cryptocurrency measures.
“We need the state attorneys general to also have the power to prosecute if the Department of Justice refuses to,” Maryland Senator Angela Alsobrooks said.
“I have been very clear about the fact that I will not vote for any legislation that does not cover ethics.”
Following the revised measures, Attorney Generals in the US would have the ability to file lawsuits against crypto exchanges in the event one lists a digital asset that is prohibited in the Clarity Act’s current language.
The updated Clarity Act would also require elected officials with a significant financial interest in a cryptocurrency issuer or exchange to either divest their holding or place the funds in a blind trust.
According to Alsobrooks and Senator Ruben Gallego, the need for extended cryptocurrency ethics in the Clarity Act had become a “red line” in discussions for Democrats, with President Trump agreeing to “80%” of the proposal previously submitted by Gallego.
The Clarity Act originally included a ban on federally elected officials, their spouses and federal judges from issuing digital assets, although greater safeguards were believed to be needed due to potential conflicts involving President Trump’s cryptocurrency interests.
Prior to the Senate’s vote on September 15, the Indian Gaming Association (IGA) called on the legislative body to reject the Clarity Act unless lawmakers add explicit protections for Tribal sovereignty and established gaming regulation.
IGA argues that its current language may allow prediction market operators to offer sports betting and casino-style products under federal commodities law, bypassing Tribal and state gaming frameworks and the Indian Gaming Regulatory Act.
The Clarity Act is primarily intended to create a federal framework for digital assets and clarify the respective jurisdictions of the Securities and Exchange Commission and Commodity Futures Trading Commission.
President Donald Trump stressed the importance of the Commodity Futures Trading Commission’s exclusive authority over prediction markets in May, describing all opposers as ‘scum’
