Elizabeth Warren Says CLARITY Bill Could Destroy the US Economy

U.S. Senator Elizabeth Warren has issued a warning against the CLARITY Act. She argues that the cryptocurrency bill can be dangerous enough to destabilize the country’s economy and significantly reduce the federal oversight over public firms. The senator from Massachusetts shared her concerns about a provision in the bill that allows companies listed on the New York Stock Exchange to opt out of the U.S. Securities and Exchange Commission (SEC) regulations.

The companies can do so by transitioning their business model to a blockchain-based model. She warned that this particular move can “blow up the value of the NYSE” by allowing major corporations to escape regulatory scrutiny.

Elizabeth Warren Warns About the Clarity Bill

She emphasized this with the statement: “Under the House bill, a publicly traded company like Meta or Tesla could simply decide to put its stock on the blockchain and – poof! – it would escape all SEC regulation. That is a serious problem for our country.”

The bill, officially known as the Digital Asset Market Structure Clarity Act, has passed through the House Agriculture Committee and the House Financial Services Committee and is now awaiting Senate review. While supporters argue it provides much-needed clarity for the crypto industry, critics, including Warren, claim it prioritizes corporate interests over consumer protection.

One of Warren’s primary concerns is the bill’s allowance for companies to raise capital via token sales on functional blockchains, effectively bypassing the SEC. This would, according to her, create a loophole for unregulated fundraising and reduce corporate accountability.

Echoing Warren’s concerns, consumer advocacy group Americans for Financial Reform (AFR) called the bill more “deregulatory” than the FIT21 framework enacted in 2024. The AFR argues the act would exempt many digital assets from SEC jurisdiction, increasing the risk of scams and fraud in the crypto market.

SEC Commissioner Hester Peirce offered a more balanced view, noting that while digital assets must not be arbitrarily classified to avoid regulation, many projects involving investor funds and central control should still fall under SEC oversight.

Meanwhile, Ripple CEO Brad Garlinghouse defended the need for regulatory reform, noting that over 55 million Americans now participate in the crypto economy, with a market cap surpassing $3.4 trillion.

“This isn’t fringe anymore. A comprehensive framework is overdue to secure the future of innovation in this space,” Garlinghouse said on July 9.

Representatives Maxine Waters and Angie Craig also expressed reservations about the bill, arguing it weakens the SEC and overly favors crypto companies. Waters has gone further, labeling the CLARITY Act, along with the GENIUS Act and Anti-CBDC Surveillance State Act, as “an invitation” for former President Donald Trump to deepen his involvement in digital assets. Trump’s crypto portfolio has reportedly surged by over $620 million in recent months.

The CLARITY Act was a focal point during this week’s “Crypto Week” in Washington, which also saw procedural advances for the GENIUS Act and the Anti-CBDC bill. President Trump has said that he plans to sign the bill into law as soon as the Senate passes it.  As the fight over crypto policy heats up, Warren and other lawmakers are still insistent that any framework must preserve the financial system and keep regular investors safe from corporate power that isn't regulated.