A leading crypto policy think tank is sounding the alarm over delays in US crypto legislation, warning that failure to pass a market-structure bill could expose the industry to aggressive enforcement and regulatory overreach.
Coin Center Executive Director Peter Van Valkenburgh said it has now been seven weeks since testimony from Treasury Secretary Scott Bessent, yet lawmakers have failed to advance a crypto market-structure bill out of the Senate Banking Committee or pass a version of the CLARITY Act.
The delay, he argues, risks leaving the industry vulnerable to shifting political priorities and enforcement actions.
"There are, indeed, nihilists in crypto, and if they win the day, well then we will all be in crypto hell. Whether that be by rejecting the developer protections in CLARITY and the BRCA in favor of short term business interests, or by depending on the continued goodwill of those in charge, that future is grim."
Related: Ripple CEO reveals CLARITY Act deadline
What is the CLARITY Act?
The CLARITY Act is a proposed US crypto market-structure bill aimed at defining how digital assets are regulated, including protections for developers and clearer roles for agencies like the SEC and CFTC.
It is facing delays as lawmakers remain divided on jurisdiction, investor protections and broader political disagreements, preventing it from advancing out of the Senate Banking Committee.
Notably, the current proposal does not fully address stablecoin yield-bearing products, leaving a key gap in how interest-generating stablecoins would be regulated.
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What happens without CLARITY
Valkenburgh outlined a stark scenario in which regulators expand their reach across the crypto ecosystem in the absence of clear legislation.
He warned that the Department of Justice (DOJ) could continue using 18 U.S.C. 1960 to prosecute developers of privacy tools as unlicensed money transmitters — a controversial interpretation that has already sparked legal battles.
At the same time, he said the Securities and Exchange Commission (SEC) could revoke existing interpretive guidance and treat a broad range of crypto assets as securities, potentially sweeping developers and infrastructure providers into regulatory categories such as brokers, dealers or exchanges.
Meanwhile, the Treasury Department and FinCEN could push broader interpretations of the Bank Secrecy Act, extending anti-money laundering (AML) and know-your-customer (KYC) requirements deeper into decentralized networks.
Together, these actions could reshape the regulatory landscape without new laws from Congress.
A push for long-term protections
Valkenburgh emphasized that the goal of passing legislation like CLARITY is not to rely on current regulators, but to establish durable protections that apply across administrations.
"The point of passing CLARITY is not to trust this administration. It is to bind the next one…
We have this moment where their voices can rise above the anti-tech, pro-authoritarian left and right. If we lose this moment because we thought we'd have a bit more revenue and a bit more latitude under the short-term friendly discretion of the current administration, then we lose our way.
We fail to stand up for the kind of transparency, neutrality, and openness that crypto stands for. And worse, we will have helped tie the noose ourselves, handing it to the future officials who will be only too happy to pull it tight."
Bipartisan window may not last
According to Valkenburgh, a rare bipartisan coalition is currently aligned on crypto policy, including Democrats Ron Wyden and Ritchie Torres and Republicans Tom Emmer, Cynthia Lummis and Warren Davidson.
This alignment presents what he described as a limited opportunity to establish statutory protections for developers and decentralized technologies.
Without legislative clarity, however, the industry could face a future defined less by law and more by enforcement discretion , a scenario Coin Center warns would leave innovation exposed to political shifts and regulatory uncertainty.
Related: Analyst revamps Coinbase rating as Clarity Act hearing nears
This story was originally published by TheStreet on Mar 30, 2026, where it first appeared in the Policy section. Add TheStreet as a Preferred Source by clicking here.
