As a former financial regulator, I understand that no law can prevent every market failure or stop every bad actor. Fraud exists in all markets, at all scales, but strong regulations can mitigate the worst outcomes. They give regulators visibility, set obligations for companies before consumers engage with their products, and require companies to operate with fundamentals and enforce accountability. The bill is often described as crypto market structure legislation. This description is accurate, but it does not capture the full scale. The market structure is the legal architecture that determines who must register with which agency, who oversees the market, which companies owe their customers, how assets are protected, what disclosures must be made, and what happens when something goes wrong.
Today, millions of Americans already use digital asset exchanges, brokers, dealers and custodians. They open accounts, buy and sell assets, rely on platforms to execute transactions, and often rely on intermediaries to hold their property. If these companies are to serve American consumers, they should operate under clear federal regulations.
The Clarity Act would create these rules. Digital asset intermediaries must be registered, meet capital and risk management standards, keep records, disclose material information to retail clients, monitor markets, address conflicts of interest and follow rules of conduct covering fraud, manipulation, marketing, oversight and fair pricing. These are basic safeguards in mature financial markets. They should also apply here.
