A new bipartisan bill, the Creating Legal Accountability for Rogue Innovators and Technology Act (CLARITY), has been introduced by US Representatives Zach Nunn (R-Iowa) and Abigail Spanberger (D-Va.). The legislation aims to prohibit US government officials from engaging with China-based crypto companies and utilizing Tether (USDT), the world’s largest stablecoin.
Addressing National Security Concerns Amid Crypto Industry’s Ties to China
CLARITY aims to safeguard the country against potential threats by ensuring that “foreign adversaries” do not gain backdoor access to critical security intelligence and the private information of Americans. The bill specifically targets Tether’s parent company, iFinex, recognizing the growing awareness of the crypto industry’s dependency on China. Recent reports indicate that China has significantly generated revenue for major crypto firms, including Tether, Bitmain, Binance, and more.
Challenges in Passing CLARITY
While CLARITY addresses the concerns surrounding China’s influence on the crypto industry, its passage faces challenges. Representatives Nunn and Spanberger may lack significant influence in the US House of Representatives, where established peers are already pursuing their crypto legislation. Though highlighting the need for scrutiny in the crypto space, the bill faces an uncertain path to becoming law.
CLARITY emerges at a crucial moment, with lawmakers recognizing the risks associated with China’s dominance in the crypto sector. The bill restricts officials from dealing with Tether and targets other entities, including The Spartan Network, The Conflux Network, and Red Date Technology Co., the architect behind China’s national blockchain project. As discussions unfold, the crypto community watches closely, mindful of the potential implications on the industry’s future and the broader landscape of national security.