US Senator Warns: Vague Crypto Rules Will Force Companies to Flee Overseas
Another day, another Washington warning shot across crypto's bow—but this one carries the weight of capital flight.
The Regulatory Exodus
A prominent US senator just fired a stark message to regulators: keep the rulebook murky, and watch the industry vanish. The argument isn't about stifling innovation; it's about competitive survival. When the playing field at home looks like a foggy minefield, the clearest path forward is a one-way ticket out.
Global rivals aren't waiting. From Singapore's sandbox to Dubai's digital asset hubs, jurisdictions are rolling out the red tape—cutting it into clear, navigable lanes. They're not just welcoming crypto firms; they're actively drafting the rulebooks those firms are desperate to read. Meanwhile, the US debate often sounds like a philosophical seminar, not a regulatory framework.
The Cost of Clarity
This isn't hypothetical. Talent, intellectual property, and tax revenue don't just relocate—they evaporate from the domestic economy. The senator's warning highlights a brutal calculus every startup founder makes: burn cash on legal gray areas at home, or deploy it building products under clear skies abroad. Most balance sheets vote for sunshine.
It's the oldest story in finance, really—capital flows to where it's treated best, not where it's lectured the most. The clock is ticking. Every month of ambiguity is a down payment on an overseas headquarters. The question for US policymakers is simple: do they want to host the next wave of financial infrastructure, or just write think-pieces about why it left?
John D’Agostino believes the bill will be enacted soon
Speaking on the bill, Lummis urged legislators on X: “Our market structure legislation changes that by establishing clear jurisdiction, strong protections, and ensuring America leads the way. Let’s get this done!”
In their review, legislators will be examining where DeFi aligns with federal law. They will also explore how to better distinguish between the SEC and CFTC’s roles in regulating digital assets.
John D’Agostino, the Institutional Head of Strategy at Coinbase, says the bill is already on the path to progress, and he remains optimistic about its steady improvement, despite frustration from the crypto sector.
He also expects the strategic bill to be passed soon. He addressed the bill’s delay in an interview with CNBC, saying that since the legislation is “fundamental” to crypto and other real asset classes, it is only reasonable that it takes time.
There is a strong chance that the CLARITY Act will be enacted, he added, referring to growing global regulatory momentum and Spain’s forward-leaning initiatives as examples. Spain has already begun passing new cryptocurrency legislation, like the European Union’s Markets in Crypto Assets Regulation (MiCA) and the Directive on Administrative Cooperation (DAC8).
D’Agostino also said that US lawmakers might feel pressured to act swiftly as other nations ramp up their cryptocurrency efforts. He added he hopes the bill can be approved this January.
He also compared the bill to the GENIUS Act, stating that the former is more complex than the latter. But he sees the GENIUS Act as transformative, adding that the passage of the CLARITY Act would be another crucial milestone in the US’s crypto journey ahead.
The CLARITY Act would need 60 votes to move forward
If the Republicans voted as a bloc, the CLARITY Act would likely pass the committee level even without Democratic support. But its eventual passage would be more contentious. After the Senate Agriculture Committee piece is merged, 60 votes will be necessary in the Senate to end debate, hence the importance of cross-party support.
Tim Scott, the chair of the Banking Committee, spoke to reporters ahead of the recess, saying the conversations with Democrats were fruitful, and some industry players responded cautiously with optimism.
If the legislation were enacted, this would create rules that regulate the digital asset market in a way that moves beyond long-term, enforcement-driven regulation. It would also clarify which token types are considered securities or commodities, explain how exchanges and brokers can register, and enable regulators to exert more control over spot crypto.
Supporters also said the changes would provide regulatory clarity and strengthen consumer protections, as well as America’s standing compared to places with clear frameworks for cryptocurrencies.
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