Crypto Rules: Who's in Charge?

The U. S. is trying to sort out who should be in charge of the crypto market. The Digital Asset Market Clarity Act of 2025, or CLARITY Act, is making its way through Congress. This act aims to end the confusion about who regulates what in the crypto world. The act has two main parts. First, it says that certain decentralized finance (DeFi) activities should not be regulated like traditional financial services. This includes things like operating nodes, wallets, and liquidity pools. The idea is to stop regulators from treating software infrastructure like a market exchange.Second, the act wants to treat "digital commodities" as "covered securities. " This would mean that federal rules would override state rules, creating a uniform market. However, this could also weaken state regulators' ability to protect consumers from scams. The act is trying to balance innovation with investor protection. But it's not clear if it will succeed. The DeFi carve-out could be too broad, allowing sophisticated operators to avoid regulation. And the preemption clause could weaken state regulators' ability to protect consumers. The act is still being debated. Senators will decide in January whether to tighten definitions, narrow safe harbors, or modify the reach of preemption. The act's success depends on whether Washington can keep this bipartisan long enough to finish the job.