Following the GENIUS bill, the US Congress is continuing its work to approve the Clarity Act, another important piece of legislation regulating the structure of the cryptocurrency market.
However, the disagreement over stablecoin yields has stalled progress in the Senate. While the Senate Agriculture Committee had advanced the bill, the Banking Committee halted the process due to disagreements over the stablecoin yield provision.
While this law is supported by the cryptocurrency market, it is also drawing criticism.
At this point, Cardano ($ADA) founder Charles Hoskinson criticized the Clarity Law once again.
In a recent live broadcast, Hoskinson argued that the Clarity Act could exempt tokens like XRP and $ADA from being classified as securities, but that the law could also harm the crypto industry in general.
Hoskinson’s main objection focuses on the provisions that would treat new crypto projects as securities by default. According to him, these provisions would make it nearly impossible for newly emerging tokens to gain liquidity, get listed on exchanges, or build a user base.
At this point, Hoskinson clashed with Ripple CEO Brad Garlinghouse over the law, describing the Calarity Act as a “terrible” bill.
Garlinghouse believes that clarity, however flawed, is better than prolonged regulatory chaos.
In response, Hoskinson expressed concern about the broader implications of the law, arguing that it risks converting nearly all crypto assets into securities by default and grants the SEC broad powers.
Hoskinson also expressed his disappointment with the inadequacy of regulations for DeFi platforms. According to him, the bill lacks clear provisions for protocols like Uniswap and prediction markets. At this point, Hoskinson believes that if not explicitly recognized, decentralized protocols could remain vulnerable to regulatory pressure.
*This is not investment advice.