Summary
Law firm client alert on the Digital Asset Market Clarity Act of 2025 (CLARITY Act), introduced May 29, 2025. Covers the bill’s key provisions: digital commodities are not presumed to be securities, disclosure requirements, SEC/CFTC jurisdictional split, issuer eligibility rules, and bipartisan prospects.
Key Points
- CLARITY Act introduced May 29, 2025 by House Committees on Financial Services and Agriculture; bipartisan.
- Digital commodities explicitly NOT presumed to be securities — resolves years of ambiguity.
- Disclosure requirements: blockchain operational details, supply mechanisms, consensus processes; semiannual reports for immature blockchain projects.
- Issuer eligibility limits: cannot be development-stage shell, investment company, or located outside U.S.
- “Immature” blockchain projects must have 4-year plan to achieve “mature” classification.
- Purchasers cannot own >10% of commodity units post-transaction.
- Leveraged transactions prohibited unless authorized under Commodity Exchange Act.
- Northern Trust Carbon Ecosystem cited as real-world example of regulated digital commodity infrastructure.
- Expected House floor vote “later this summer” at time of writing; bipartisan support expected to carry it.
Newsletter Angles
- The SEC/CFTC jurisdictional split is the core policy choice: more assets going to CFTC (a smaller, less resource-intensive regulator) is effectively a lighter regulatory touch for most crypto.
- The “immature blockchain” concept is interesting — it bakes in a 4-year transition period during which token issuers operate in a lighter-regulatory zone.
Entities Mentioned
- Jerome Powell / SEC and CFTC — both agencies gain/lose jurisdiction
Concepts Mentioned
- CLARITY Act — this is the legal analysis
- GENIUS Act — noted as companion legislation
Notes
Law firm client alert; professional and neutral in tone. More focused on compliance implications than policy analysis. The Northern Trust example is oddly specific and may reflect that Northern Trust is a Faegre Drinker client.