The CLARITY Act, which cleared the House in July 2025 with 78 Democrats joining the majority, now faces new opposition. Law enforcement groups and Catholic leaders have sent letters to the U.S. government warning that Section 604 of the bill would create regulatory and anti-money laundering loopholes by exempting certain crypto developers and infrastructure providers from money transmitter rules, according to Bitcoin Magazine.
The House Financial Services Committee has scheduled a July 17 field hearing in New York, giving the bill another public stage while the Senate floor vote remains unscheduled. The bill's delivery now depends on seven Senate Democrats, CryptoSlate reports.
Critics argue the exemption could hamper efforts to track illicit crypto transactions, potentially weakening existing financial crime safeguards. The Biden administration has not yet taken a formal position on the legislation, but the letters add pressure as the bill moves toward a potential vote.
Market reaction has been muted, with Bitcoin trading flat near $67,500 as traders await clarity on regulatory outcomes. The broader crypto market cap remains stable at $2.4 trillion, with regulatory uncertainty continuing to weigh on sentiment.
Community response has been divided, with some developers welcoming reduced compliance burdens while others fear increased scrutiny if the bill passes with loopholes. Competing legislative proposals in the Senate offer alternative frameworks that could see broader bipartisan support.