Sheriffs of America’s major counties have reportedly said they no longer oppose the CLARITY Act after initially expressing concerns about the bill’s impact on investigations into illicit finance.
On Friday, in a letter to U.S. Senate Banking Committee Chairman Tim Scott and Sen. Elizabeth Warren, MCSA said it had changed its position on the CLARITY Act to “neutral” after some of the concerns contained in the May 14 letter regarding Section 604 of the Act were resolved.
Section 604 refers to the Blockchain Regulatory Certainty Act, which aims to protect developers from liability for illegal user activities on their decentralized platforms.
MCSA has previously held that Section 604 could create a loophole for criminals to exploit, making it more challenging for law enforcement to investigate cryptocurrency crimes.
Source: Eleanor Terret
While the CLARITY Act has bipartisan support, its passage through the Senate has been largely held up by banking groups trying to limit the yield of stablecoins, which they say act like an unregulated deposit product that could cause trillions of dollars to flow out of the established banking system.
The bill has been awaiting a full Senate vote since May, when the Senate Banking Committee passed it largely on partisan lines.
Senators supporting the bill are calling for a full Senate vote this month, hoping it will be passed and signed into law before the U.S. midterm elections in November.
One of the “biggest obstacles” under the CLARITY Act has been removed
Cryptocurrency investor Mark Chadwick described MCSA’s initial opposition to the CLARITY Act is considered one of the “biggest obstacles” preventing the Senate from passing the bill.
“With that obstacle removed, the path to passage became much clearer,” Chadwick said. “Another major hurdle down.”
MCSA continues to push for improvements to the CLARITY Act
MCSA has stated that it would like to see the CLARITY Act amended to include state law enforcement agencies in s. 309, which requires the Treasury Department to investigate risks associated with decentralized finance and illicit financing.
Related: Senate leaders are pushing for July passage of the CLARITY Act
MCSA President Bob Gualtieri argued that Congress should provide the training, technology and resources needed to “investigate increasingly sophisticated digital asset activities” linked to fraud, drug trafficking, ransomware, child exploitation, terrorist financing and other crimes.
“State and local law enforcement investigate these crimes every day and must have the tools, partnerships and resources necessary to identify criminals, track illicit proceeds, recover property and protect victims.”
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