Peter Van Valkenburgh, executive director of advocacy group Coin Center, is warning that the failure to pass a crypto market structure bill could expose the industry to a future crackdown by a less sympathetic US government. In a post on X on Friday, Van Valkenburgh argued that prioritizing short-term business interests over legislative protections would leave the sector in a precarious position. He contends that the goal of passing the bill is not to express trust in the current administration, but to constrain the next one.
The legislation at the center of the debate is the CLARITY Act, which Van Valkenburgh describes as essential for establishing statutory protections for developers. He also referenced the Blockchain Regulatory Certainty Act as part of the broader push for developer safeguards. Without such protections, he argues, the industry would be left subject to prosecutorial discretion, shifting political priorities, and an atmosphere of fear.
The CLARITY Act has stalled in the Senate after banks, crypto firms, and lawmakers were unable to reach agreement on several key provisions. One major sticking point has been whether to permit yields on stablecoins. The bill encompasses a broad set of measures, including frameworks for registering crypto intermediaries, regulating digital assets, and classifying tokens.
Van Valkenburgh also warns of specific risks that could materialize without legislative clarity. He predicts that a future administration’s Department of Justice could increase prosecutions of privacy-tool developers on the grounds that they operate as unlicensed money transmitters. He further cautions that existing regulatory interpretive guidance could be revoked at any time, leaving the industry without stable legal footing.
The current regulatory environment marks a notable shift from the previous US administration, during which former SEC Chair Gary Gensler faced heavy criticism from the crypto sector. Critics accused Gensler of shaping policy through enforcement actions and legal settlements with crypto firms rather than through formal rulemaking processes. His approach was widely seen as hostile to the industry.
Since Gensler’s resignation on January 20, 2025, crypto advocates have observed a more favorable posture from the SEC, including the dismissal of several long-running enforcement actions against crypto companies and the issuance of friendlier guidance on how the agency intends to treat digital assets. Despite this shift, Van Valkenburgh cautions against complacency. He argues that relying on the goodwill of the current administration rather than securing durable legislative protections is a strategic mistake the industry cannot afford to make.
Originally reported by CoinTelegraph.
