U.S. Treasury Secretary Scott Bessent has stated that Congress must pass legislation to establish federal regulatory standards for digital assets. He reiterated the need for such regulations, emphasizing that they would ensure the growth and investment in cryptocurrency remain firmly rooted in the United States.
Bessent is urging Congress to approve a cryptocurrency market structure bill known as the CLARITY Act.
“The regulatory framework for the digital asset market remains unclear,” Bessent said on Wednesday, adding that this uncertainty has led to foreseeable consequences.
“An increasing amount of cryptocurrency development activity is moving to jurisdictions with clear regulatory guidelines, such as Abu Dhabi and Singapore. Overseas, companies understand when and how to register, what standards they must meet, and how to conduct their operations. The advantages of basing headquarters in the U.S. are often outweighed by the associated risks,” Bessent wrote.
The CLARITY Act aims to establish federal rules for digital assets and represents the culmination of years of lobbying by the cryptocurrency industry. Crypto firms have long argued that current regulations are ill-suited for digital assets and that new legislation is essential for businesses to operate legally and soundly in the United States.
For months, disagreements between the banking and cryptocurrency sectors over how the bill should handle interest and other earnings from stablecoin payments have stalled progress on cryptocurrency market structure legislation. Banks have been pushing for provisions that would prohibit such practices.
The U.S. House of Representatives passed a corresponding version of the bill in July.
In February, Bessent indicated that the legislation would “significantly reassure the market” amid periods of high volatility. He also noted that while some cryptocurrency firms have attempted to block the bill, a bipartisan group of lawmakers continues to support its passage.
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