Clarity Act Classifies Crypto Exchanges as Banks
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- U.S. Senate Banking Committee released the text of the Clarity Act on Monday, ahead of a Thursday committee vote.
- Clarity Act would classify crypto exchanges, brokers, and dealers as financial institutions under the Bank Secrecy Act, imposing AML and KYC requirements.
- Clarity Act bans interest‑like rewards on idle stablecoin balances that resemble bank deposits, while allowing rewards for payment‑related activities, with rulemaking by the SEC, CFTC, and Treasury Department.
- Clarity Act sets a decentralization test; platforms that cannot block users or grant special privileges would be regulated as financial institutions.
- Clarity Act requires tokenized securities to remain subject to existing securities laws and tasks the SEC with studying further token‑security regulations.
Why it matters: Crypto firms will incur higher compliance costs, banks keep deposit oversight, the Treasury gains authority over stablecoin reward structures, and the SEC must study tokenized securities regulation.
