DeFi Group Sounds Alarm Over Proposed 'Anti-DeFi' Amendments to CLARITY Act
A prominent cryptocurrency advocacy group has issued a stern warning regarding a series of proposed legislative changes that could fundamentally threaten the decentralized finance (DeFi) ecosystem in the United States, targeting both developers and end-users.
Regulatory "Sword" Against Developers
The DeFi Education Fund (DEF) recently identified 16 "anti-DeFi" amendments proposed for the Senate Banking Committee’s crypto market structure bill, known as the CLARITY Act. According to the advocacy group, these amendments—backed by several Democratic Senators—aim to strip away core protections for non-controlling developers. Of particular concern are changes to the Blockchain Regulatory Certainty Act (BRCA), which currently shields developers from federal money transfer requirements. The DEF warns that these rewrites would transform the BRCA from a protective shield into a "sword" used to prosecute those building decentralized protocols.
Direct Attacks on Smart Contracts
Beyond developer liability, the proposed changes include measures that could subject autonomous smart contracts to international sanctions, regardless of whether they are owned or modified by any individual. This move is seen as a direct challenge to recent federal court decisions, such as the 5th Circuit’s ruling involving Van Loon, which provided some legal clarity for decentralized systems. Industry experts argue that by subjecting autonomous code to the same obligations as traditional financial institutions, the legislation effectively ignores the technical reality of how DeFi operates.
A Call for Community Action
The crypto community has reacted sharply to these developments, with leaders like Tornado Cash co-founder Roman Semenov and Paradigm VP Justin Slaughter urging users to contact their representatives. Critics argue that these last-minute proposals defeat the original purpose of the CLARITY Act, which was intended to provide a functional framework for digital assets. As the Senate prepares for its markup session, the DeFi sector remains on high alert, fearing that the broad expansion of Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) obligations could stifle American innovation and push the industry offshore.
