Washington, D.C. — In a major bipartisan effort to bring clarity and consistency to the regulation of digital assets, Congressman Don Davis (D-NC-01), Ranking Member of the Commodity Markets, Digital Assets, and Rural Development Subcommittee, has joined forces with a coalition of lawmakers to introduce the Digital Asset Market Clarity (CLARITY) Act of 2025.

Co-led by Davis and House Agriculture Committee Ranking Member Angie Craig (D-MN-02), the legislation is backed by a bipartisan group including House Financial Services Committee Chair French Hill (R-AR-02), House Agriculture Committee Chair Glenn “GT” Thompson (R-PA-15), and other prominent voices from both sides of the aisle.

The CLARITY Act is designed to establish a comprehensive regulatory framework for digital assets, ensuring fair oversight, promoting innovation, and protecting consumers in one of the fastest-growing sectors of the modern economy.

“Families, entrepreneurs, and small businesses across our country, including rural areas in eastern North Carolina, seek ways to engage in the modern economy,” said Rep. Davis. “Digital assets present a chance for a more inclusive financial future, but we need clear rules and fair oversight for innovation to thrive. Congress must ensure that America shapes digital finance, creates opportunities, protects consumers, and supports overlooked communities.”

Key Provisions of the CLARITY Act

The legislation seeks to clearly define when a digital asset falls under the regulatory authority of either the Commodity Futures Trading Commission (CFTC) or the Securities and Exchange Commission (SEC):

• CFTC Oversight of Digital Commodities: The bill grants the CFTC authority over “digital commodities,” which include blockchain-based assets that are considered decentralized or part of “mature” systems.
• SEC and CFTC Rulemaking: While the bill outlines key categories, it instructs both agencies to further define terms through regulatory rulemakings, ensuring flexibility as the market evolves.
• Secondary Market Regulation: The CFTC would oversee most secondary market transactions—where previously issued crypto assets are bought and sold.
• Registration Requirements: Exchanges, brokers, and dealers offering trading in digital commodities would be required to register with the CFTC and meet strict standards related to market integrity, disclosures, customer fund protection, and recordkeeping.

Building on Previous Legislative Momentum

The CLARITY Act builds on the groundwork laid by the Financial Innovation and Technology for the 21st Century Act introduced in a previous session of Congress. It reaffirms the CFTC’s authority over “spot market” digital commodity transactions, with narrowly defined exceptions, and aims to prevent manipulation in crypto markets while providing a stable path forward for legal compliance.

A Step Toward Modernizing U.S. Financial Regulation

With bipartisan backing and growing recognition of digital assets’ economic significance, the CLARITY Act represents a critical step toward modernizing the United States’ approach to financial regulation in the digital age.

Supporters of the bill argue that without federal clarity, innovation will move overseas or remain stuck in legal limbo, while consumers remain vulnerable in unregulated markets.