CLARITY Act to Offer ‘Strongest’ Legal Protections for DeFi Developers, Says Lummis

US Senator Cynthia Lummis has emphasized that the Digital Asset Market CLARITY Act will provide unprecedented legal protections for decentralized finance (DeFi) developers. The remarks come amid concerns that non-custodial software developers could be exposed to regulatory liabilities under current legislation.

Lummis confirmed that recent bipartisan revisions to Title 3 of the Act will clarify that non-controlling developers and providers of non-custodial software are not subject to Bank Secrecy Act KYC obligations. She stated these changes make the bill “the strongest protection for DeFi and developers ever enacted” and urged swift passage to secure these safeguards.

Legal Clarity for DeFi Amid Developer Prosecutions

Crypto lawyer Jake Chervinsky noted that stablecoin yield provisions have overshadowed developer protections, and concerns remain that misclassification as money transmitters could still create liability. High-profile prosecutions, including the Tornado Cash co-founder conviction in August 2025, underscore the need for legal clarity.

CLARITY Act Progress and Senate Timeline

Lawmakers expect the CLARITY Act to reach Senate Banking Committee markup in April, with bipartisan efforts focused on balancing stablecoin regulation and developer protections to ensure DeFi innovation is safeguarded.

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