DEF’s Bold Move: Senate Urged to Shield Crypto Devs in Groundbreaking Legislation

Crypto's clash with regulation takes a dramatic turn as DEF lobbies for developer protections—because nothing says 'decentralization' like begging Congress for favors.

The Battle Lines Are Drawn

DEF isn't waiting for regulators to act. Their new bill pushes the Senate to carve out safe harbors for blockchain builders—an ironic twist for an industry built on 'code is law' absolutism.

Why This Matters Now

With enforcement actions spooking developers, DEF's play could determine whether the next Vitalik builds in Delaware or disappears into a Tor node. The bill's fate may hinge on whether senators can tell a smart contract from a Netflix subscription.

The Finance Jab

Wall Street's already salivating—nothing boosts banking profits like lobbying for regulatory capture dressed up as 'innovation protection.'

DEF Urges Balanced DeFi Regulation 

The group has highlighted that legislation must strike a balance between combating illicit finance and fostering DeFi innovation. The DEF also called for revised guidance from the Financial Crimes Enforcement Network (FinCEN) to clarify the definition and regulations surrounding non-custodial, non-controlling software. Those involved in the Tornado Cash case should not be treated as a financial institution. 

The firm warned that the bill’s current framework could create loopholes, allowing insiders to bypass securities laws, such as the Howey test, and sell tokens to the public without oversight. A16z proposed a “digital commodity” model with clear decentralization standards to better protect investors while supporting innovation.

Senate Banking Committee Embraces DeFi Feedback

The Defi Education Firm has stated on its X post that “the DeFi Education fund team submitted a response to DeFi-related questions posed by BankingGOP’s Digital Asset Market Structure RFI & recently published discussion draft of market structure legislation.”  

The Senate Banking Committee welcomed the feedback, noting that it aims to refine the Digital Asset Market Clarity Act of 2025 to promote DeFi innovation while ensuring consumer protections and financial stability.

Also Read: DeFi Trading Peaks; Traders Rush to Hyperliquid Causes API Outage